Example of A Stock Split .What is a Stock Split?

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Example of A Stock Split .What is a Stock Split?


A stock split is a corporate event that occurs when a company divides its existing shares into multiple shares. The number of stocks and the ratio of the newly issued stocks to the old ones vary from company to company. A stock split is usually done to increase liquidity, reduce share price volatility and make trading more affordable for investors. As an example Nintendo CO Ltd stock.


For example: if the split ratio is 2:1, then, Each share previously held, shareholders would now hold two shares. Subsequently, the price of the share is also adjusted according to the same ratio in order to maintain the same overall value in price . Example Nintendo CO Ltd and changes in holdings of units are due to this adjustment.To summarise, the price of the instrument and the amount of units in Nintendo CO Ltd positions may change, but the value of all positions remains the same.