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StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
When a company divides its shares. A 2-for-1 split doubles your shares at half the price.
Why It Matters
Stock splits don't change your total value - they just cut the pizza into more slices. If you own 10 shares at $100 ($1,000 total), after a 2-for-1 split you own 20 shares at $50 ($1,000 total). Companies split to make shares more accessible - Amazon's 20-for-1 split in 2022 dropped the price from $2,400 to $120.
Key Points
- Splits are usually bullish signals - companies split when stock price has been rising
- Apple has split 5 times; if you bought 1 share in 1980, you'd now have 224 shares
- Reverse splits (combining shares) are often bad news - usually done when price is too low
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Common Questions
When a company divides its shares. A 2-for-1 split doubles your shares at half the price. Stock splits don't change your total value - they just cut the pizza into more slices. If you own 10 shares at $100 ($1,000 total), after a 2-for-1 split you own 20 shares at $50 ($1,000 total).
Stock splits don't change your total value - they just cut the pizza into more slices. If you own 10 shares at $100 ($1,000 total), after a 2-for-1 split you own 20 shares at $50 ($1,000 total). Companies split to make shares more accessible - Amazon's 20-for-1 split in 2022 dropped the price from $2,400 to $120.
Splits are usually bullish signals - companies split when stock price has been rising
Apple has split 5 times; if you bought 1 share in 1980, you'd now have 224 shares
Reverse splits (combining shares) are often bad news - usually done when price is too low