stock split

stock split
Occurs when a firm issues new shares of stock and in turn lowers the current market price of its stock to a level that is proportionate to pre- split prices. For example, if IBM trades at $100 before a two-for-one split, after the split it will trade at $50, and holders of the stock will have twice as many shares as they had before the split. Bloomberg Financial Dictionary
See: Split. Bloomberg Financial Dictionary
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See subdivision See also change in nominal value Euroclear Clearing and Settlement glossary
Increase in a corporation's number of outstanding equities without any change in the shareholder's equity or the aggregate market value at the time of the split. Equity price and nominal value are reduced accordingly. Euroclear Clearing and Settlement glossary

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stock split stock split split2

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   The break-up of a share into smaller units without affecting either the total share capital or reserves. The main effect is to reduce the unit price of each quoted share, making them easier to trade in small lots and more attractive to small investors. Opposite of a reverse stock split.
   ► See also Reverse Stock Split.

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stock split UK US noun [C] (also share split) STOCK MARKET, FINANCE
an occasion when a company’s shares are divided into smaller units to make them easier to sell at a lower price, while the total value of the company's shares remains the same: »

When their share price approaches triple digits, they usually do a stock split.

»

A software publisher gained after declaring a 2-for-1 stock split.

Compare SPLIT STOCK(Cf. ↑split stock)
See also REVERSE STOCK SPLIT(Cf. ↑reverse stock split)

Financial and business terms. 2012.


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