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Investing Glossary:
Stock split
Copyright 2010,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| Definition: |
| 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. See: Split.
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