- Item type
- Periodical
- Language
- English
- Source
- Harvard Business Review. Apr1933, Vol. 11 Issue 3, p316. 11p.
- Publication date
- 01/04/1933
- ISSN
- 00178012
This article reviews the practice and the effects of stock-splitting with particular focus given to the price effect of splitting common shares. A stock split-up refers to the multiplication of the numbers of shares, causing the value of the shares to decrease while the value of the overall lot of the shares remains the same. The practice started during the first World War and became much more prevalent during the decade 1921-1930. The process of stock-splitting is usually divided into five parts which the author describes. Information on the process of exchanging old certificates is included, along with penalties for failures to do so.
