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Typically, at the time of a split, values remain the same, but PRICE drops. It usually takes place to make the "per share" price more affordable. For example- a stock has gained value, and is trading at $100 per share. The company decides to have a 2 for one split. You had 10 shares of the old $100/share stock. You would get 20 shares of the NEW stock, which would be worth $50 per share. No net change.

However, when a company announces a split, it is usually because the stock has been going up for some time- a good thing.

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Q: When stocks split do they go down in value?
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How does value of stocks come down?

The price of stocks is determined by the Demand and Supply theory. When there is a heavy demand for stocks and the supply is less then the prices go up. When there is a heavy supply of stocks and there is less demand then the prices go down.


How does the stock market raise and lower?

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