Upcoming GOOG Stock Split on 18 July 2022

   

Dear Trader,

Please be advised of the upcoming ALPHABET INC-CL C(GOOG) stock split that is going to take place as per the following schedule:

  • Ex-Date: 18 July 2022

Common shares will trade at the new split-adjusted price from 18 July 2022 onwards.

What is a stock split?

A stock split is a corporate action taken by companies that have seen their share price increase to levels that are either too high or are beyond the price levels of similar companies in their sector, to divide their existing shares into two or more shares. Read more about stock split here.

Why do stocks split?

The primary motive is to make the shares more affordable to small investors even though the underlying value of the company has not changed. GOOG would like its stock to be more accessible to a broader base of investors.

What is the split ratio?

GOOG also announced it will split its stock in a 20 for 1 offering. 

What will this split mean to investors?

Each share of ALPHABET INC-CL C stock that an investor owns before Ex-Date (18 July 2022) will be eligible for stock split. Investors will receive nineteen additional shares and the stock price will be divided by 20. 

Here is an example:

 Pre-SplitPost-SplitAs of 18 July 2022
Shares held100 shares2000 sharesShares are multiplied by 20
Share Price$2000 per share$100 per shareShare price is divided by 20
Value$200,000$200,000Total value remains equal

If an investor owns 100 shares and the market price is $2000, $2100 as take profit. After 20 for 1 stock split, the investor will own 100*20= 2000 shares and the estimated post-split price would be $2000/20 = $100, and the take profit price will adjust to $2100/20=$105.  

All pending orders: Buy Limit, Sell Limit, Buy Stop, Sell Stop, Buy Stop Limit, Sell Stop Limit, will be deleted.

Does the 20 for 1 stock split mean the value of my ALPHABET INC-CL C shares will increase nineteen times? 

Unfortunately, not. As stated in the above example, the increase in the number of stocks means every share is now worth less than its previous value, precisely, it’ll be 1/20 the previous value.

How do stock splits affect short sellers?

Stock splits do not affect short sellers in a material way. There are some changes that occur as a result of a split that affects the short position, but they don’t affect the value of the short position(s). 

If you have any questions about any of these changes, please contact our Client Service team or your Account Manager.

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