Shares Split

When a company's shares are split, outstanding shares multiply. The shares are divided and the price is reduced. Say you have a twenty dollar bill, and somebody offers to give you two ten dollar bills in exchange for it. That's the same concept applied to share splitting. You have the same amount of money, only split into two smaller denominations.

Shares are split when a company's share price has grown so high that investors think the shares are too expensive to buy, so the company divides them into multiple shares. In effect, investors are holding twice the amount of shares with half the price.

Shares are split when a company's share price has grown so high that investors think the shares are too expensive to buy, so the company divides them into multiple shares. In effect, investors are holding twice the amount of shares with half the price. Read more here.