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Stock split

A company divides each share into more shares, cutting the price per share proportionally and leaving the value of your holding unchanged.

A split changes the units, not the pie. A 4-for-1 split turns one $400 share into four $100 shares. outstanding-shares quadruple, eps is restated down by four, and historical charts are adjusted so the split does not appear as a crash.

Companies split to keep the price in a range retail buyers and round-lot option buyers find accessible. With fractional-shares widely available the practical need has faded, but splits still attract attention and often come with index-rebalance weight changes in price-weighted indexes.

Example: you own 50 shares at $600, worth $30,000. After a 3-for-1 split you own 150 shares at $200, still $30,000. An option contract on 100 shares at a $620 strike becomes three contracts at a $206.67 strike.

Related: reverse-split, outstanding-shares, options-multiplier

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