Tesla, Inc. announced a five-for-one split of Tesla common stock. Entitled shareholders will have five shares for every one piece they own.
When will Tesla split happen?
After the markets close on August 28, 2020, each Tesla shareholder will get four additional shares for every common stock they own. Monday, August 31, 2020, will be the first day when Tesla stocks will be traded at post-split prices.
If you have a position open on TSLA.US after the markets close on Friday, on Monday morning when the trading begins at 1:30 p.m. UTC you will have five times more units, but at the split-adjusted price.
What is a stock split?
When a company decides that the price of one share is too high, they decide to increase the number of outstanding shares. They split the shares owned by current shareholders, and this way increase the market liquidity.
Why did Tesla decide to split the stock?
Tesla stock has skyrocketed way above $2000. That’s why the company decided to make the first split in history. Apple decided to do the same move when its stock reached $500. Both splits will take place on the same day.
At the moment Tesla stock trades on SimpleFX at $2152 if the 5-for-1 split happened at this price, investors would need only $430.4 to buy one share.
How will the split affect the price?
Friday’s closing price of Tesla stock will be divided by five. The opening price on Monday may be above or below that level. SimpleFX traders should expect an increase in Tesla stock volatility before and after the split.
Tesla is already the most valuable automaker in the world. The company has its long-term investors and short-sellers, which makes it a great asset for day trading. Make sure you watch Tesla trends on SimpleFX and profit from big price movements.