Apple and Tesla review share prices to attract more shareholders

Apple and Tesla shares will be significantly more affordable on Monday, which should make them even more popular. REUTERS / Gonzalo Fuentes

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The two tech giants, Apple and Tesla, are dividing their shares to make them more affordable but also to attract more shareholders. A process called “stock split”, understand “split operation”. This is not the first time that Apple and Tesla have resorted to this practice.

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By dividing up stocks, they become more affordable. Concretely, it is a question of converting one share into several shares according to a determined ratio. For holders of Apple shares, it is 4. This means that the stock which was worth about 502 dollars last Friday is worth 125 this Monday morning.

Ditto for Tesla whose share was worth $ 2,281: for the same amount the shareholder will receive $ 5 to $ 456 per unit. The holder's portfolio amount has not fallen, it is his number of shares that has increased.

So why increase the volume of stocks? Well, quite simply to make them more attractive in order to increase the number of shareholders. This is how technological stocks grow on the stock market, but to achieve this, stocks must not take off, but for 3 months they have soared.

By splitting them up, Apple and Tesla maintain demand and therefore increase their liquidity, which reassures shareholders. As proof: upon the announcement of this new division, shares of Apple and Tesla increased by 25 and 45% respectively. So the circle is closed.

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