Stock Splits

What is a forward stock split?

• A forward stock split is a corporate action in which a company decreases the number of its outstanding shares by combining multiple shares into one.

• A forward stock split is a corporate action in which a company increases the number of its outstanding shares by dividing each existing share into multiple shares.

• A forward stock split is a corporate action in which a company decreases the value of its outstanding shares by dividing each existing share into multiple shares.

• A forward stock split is a corporate action in which a company increases the number of its outstanding shares by combining multiple shares into one.

What is a reverse stock split?

• A reverse stock split is a corporate action where a company increases the number of its outstanding shares, resulting in a decrease in the share price.

• A reverse stock split is a corporate action where a company merges with another company to form a new entity.

• A reverse stock split is a corporate action where a company reduces the number of its outstanding shares, resulting in an increase in the share price.

• A reverse stock split is a corporate action where a company distributes additional shares to its existing shareholders.

Why do companies choose to do a forward stock split?

• To increase the price of shares

• To reduce the number of shareholders

• To decrease liquidity and affordability of shares

• To increase liquidity and affordability of shares

Why do companies choose to do a reverse stock split?

• To increase the price per share and attract more investors.

• To split the company's shares into multiple classes and confuse investors.

• To maintain the current price per share and limit investor interest.

• To decrease the price per share and discourage investors.

How does a forward stock split affect the number of shares outstanding?

• increases

• doubles

• has no effect

• decreases

How does a reverse stock split affect the number of shares outstanding?

• It reduces the number of shares outstanding.

• It has no effect on the number of shares outstanding.

• It increases the number of shares outstanding.

• It doubles the number of shares outstanding.

What is the purpose of a forward stock split?

• The purpose of a forward stock split is to increase the number of shares outstanding while reducing the price per share.

• The purpose of a forward stock split is to decrease the number of shares outstanding while increasing the price per share.

• The purpose of a forward stock split is to keep the number of shares outstanding the same while increasing the price per share.

• The purpose of a forward stock split is to decrease the number of shares outstanding while reducing the price per share.

What is the purpose of a reverse stock split?

• To decrease the stock price or avoid exchange requirements.

• To maintain the stock price or meet investor expectations.

• To split the stock into multiple shares and increase liquidity.

• To increase the stock price or meet exchange requirements.

What are the potential benefits of a forward stock split for investors?

• Increased buying power for investors

• Reduced risk for investors

• Higher dividend payouts for investors

• Increased affordability and liquidity

What are the potential benefits of a reverse stock split for investors?

• Increased share price, decreased liquidity, and negative perception of the company's value.

• No change in share price, decreased liquidity, and negative perception of the company's value.

• Increased share price, improved liquidity, and enhanced perception of the company's value.

• Decreased share price, reduced liquidity, and diminished perception of the company's value.