What is a stock split?
A stock split is a change in the capitalization of an issuer that increases or decreases the number of securities outstanding, and adjusts the value of the securities accordingly, without a corresponding change in the assets or capital of the issuer. Stock splits may either be forward or reverse.
When a company decides to do a forward stock split, they increase the number of shares available to investors while decreasing the price of each share proportionally.
A reverse stock split is similar. When a company decides to do a reverse stock split, they decrease the number of shares available to investors while increasing the price of each share proportionally.