Stock Split

A stock split is a corporate action where a company increases the number of its outstanding shares by issuing additional shares to existing shareholders, in proportion to their holdings, without changing the total market capitalization or overall value of the company. For example, in a 2-for-1 split, each shareholder receives an additional share for every share owned, and the price per share is halved—so an investor with 100 shares at $100 each would wind up with 200 shares at $50 each.​

Stock splits are often performed to make shares more affordable and attractive to a broader range of investors, increase liquidity and trading volume, and sometimes signal management’s confidence in future growth. While the total value of an investor's position does not change, splits can have psychological and practical benefits for market participants.​

There are also reverse stock splits, where the number of outstanding shares is reduced and the share price rises proportionately, often to help a struggling company avoid delisting by raising its per-share price.