What is a Share Split?
A share split occurs when a company divides its existing shares into multiple new shares. This action increases the number of shares available while keeping the overall market capitalization the same. For instance, in an Apple share split, the company may decide to split its shares to lower the price per share, making it more accessible to retail investors.
The Benefits of an Apple Share Split
The primary advantage of a share split, especially in the case of a well-known stock like Apple, is the potential to increase liquidity. When the share price decreases due to a split, more investors may acquire shares, facilitating easier trading. This can improve the stock’s market visibility and attract a broader range of investors, enhancing market competition.
Historical Context of Apple’s Share Splits
Apple has undergone several share splits throughout its history, with the most recent being in August 2020, when the company executed a 4-for-1 split. This move made each share more affordable, while investors still retained the same ownership percentage. Understanding these historical splits helps investors gauge Apple’s growth trajectory and evaluate future stock performance.