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Stock Split & Reverse Stock Split
Stock Split & Reverse Stock Split

Learn all about Stock Split & Reverse Stock Split at NAGA

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Written by Support Team
Updated over a week ago

What is a stock split?

A stock split is when more shares are issued to current shareholders without the devaluing of their stake.

A stock split does not affect a company s market capitalization (the total value of all its shares) or the value of each shareholder’s stake in the company. It simply raises the number of outstanding shares while lowering the price per share.

Stock splits decrease the value of each individual share and multiply the volume.

Stock Split: volume is multiplied and price is divided.

What is a reverse stock split?

A reverse stock split is a type of corporate action that consolidates the number of existing shares of stock into fewer (higher-priced) shares. A reverse stock split divides the existing total quantity of shares by a number such as five or ten, which would then be called a 1-for-5 or 1-for-10 reverse split, respectively. A reverse stock split is also known as a stock consolidation, stock merge, or share rollback and is the opposite of a stock split, where a share is divided (split) into multiple parts.

Reverse stock splits increase the value of each individual share and divide the volume.

Reverse Stock Split: volume is divided and price is multiplied.

In all cases both trade volume and price are adjusted accordingly, but the Profit & Loss stays the same.

All pending orders (Buy Limits and Sell Limits) will be cancelled. Moreover, stop-loss and take-profits limits already set will be cancelled upon execution of the stock split. Please note, these limits should be set again after the split at your own convenience.

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