Understanding Stock Split with an Example | Example of Stock Split?

Описание: Stock Split with an Example! 📊💡

Let's understand stock split through a simple example: Suppose a company's stock price is ₹500, and they declare a 1:5 stock split.

What happens next? Instead of having 1 share, you will now receive 5 shares for every 1 share you previously held. 📈🔢

Furthermore, the share price undergoes a proportional reduction. In this case, the new share price after the split becomes ₹100, as it gets divided by 5.

The exciting part is that your overall investment amount remains the same, but the number of shares you own increases. This can offer potential benefits such as increased liquidity and wider market participation. 💰🚀

As a result of the stock split, both the Current Market Price (CMP) and the face value decrease. This adjustment allows investors to have more shares at a lower price, making the stock more accessible.

Stock splits are often employed to make shares more affordable and attract a broader investor base. It's an interesting strategy that can create new opportunities in the market! 🌟💼

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