Increasing the number of shares, which simultaneously reduces the nominal share value. The reason for a split is usually the high price of the stock, which is done to make the stock price more suitable for small investors. A split requires permission from the company’s supervisory board and shareholders.
Example. A share costing EUR 100 will be subject to 2:1 split. Following the split, the price of one share is EUR 50. Former stockholders have twice as many shares after the split, but each of them costs half of the former: EUR 50 There may also be a reverse stock split, in which case the share price increases. Synonyms: share split, stock split, split.