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What Is Stock Split?

Definition and plain-English explanation of "Stock Split"

Stock Split — Basics illustration

A stock split increases the number of a company's shares while proportionally lowering the price of each, leaving the total value unchanged. In a 2-for-1 split, one $200 share becomes two $100 shares. Splits make shares more affordable to retail investors. A reverse split does the opposite, consolidating shares to raise the price.

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