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RE: LeoThread 2025-07-01 12:43

in LeoFinance3 months ago

Part 3/7:

While stock splits do not inherently enhance a company's value, they serve multiple strategic purposes. Companies might pursue them to make their stock more accessible to the average investor. For instance, Apple CEO Tim Cook indicated that the company's seven-for-one split was aimed at making the stock more attainable for a larger base of investors.

Additionally, stock splits can make it easier for certain financial instruments, such as options, which often require transactions in lots of 100 shares. With lower share prices, these options become more feasible for traders.

Moreover, increasing the number of shares outstanding through a split can foster greater liquidity, allowing shares to be traded more freely.

Why Some Companies Avoid Splitting Their Stock