What Is a Reverse Stock Split?
The SEC says a company reduces its number of outstanding shares.
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1.What does a reverse stock split do?
The SEC says a company reduces its number of outstanding shares.
2.You hold 100 shares at 2. After a one-for-five reverse split, how many shares at what price?
20 times 10 is 200, the same as before.
3.Does the split itself change the total value of your position?
The SEC says a shareholder's total market value stays the same; what happens afterward is a different question.
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Sources (7)
- SEC: Stock Splits (sec.gov/answers/stocksplit.htm)
- FINRA: Corporate Actions by Public Companies: What You Should Know
- Proxy Statement (DEF 14A) eines US-Unternehmens, December 2020, Abschnitt Reverse Stock Split (EDGAR, SEC)
- Dechert LLP: Nasdaq Proposes Stricter Rules on Reverse Stock Splits (July 2024)
- Desai, H., Jain, P. C.: Long-Run Common Stock Returns Following Stock Splits and Reverse Splits, The Journal of Business 70(3), 409-433 (1997)
- Eigene Rechnung: Reverse Split 1:5 (Uebungsaufgabe)
- Iveda Solutions, Inc.: Form 8-K
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