Stock Split Calculator
Calculate how a stock split or reverse split affects your shares, price per share, and cost basis. Supports forward and reverse splits.
Stock Split Calculator
Calculate how a stock split or reverse split affects your shares, price per share, and cost basis. Supports forward and reverse splits.
What is a Stock Split?
A stock split is a corporate action where a company divides its existing shares into multiple shares. In a 2:1 forward split, each share becomes two shares at half the price. The total value of your position remains the same — you just own more shares at a lower price per share. Companies typically do this to make shares more affordable and increase liquidity. Famous examples include Apple's 4:1 split in 2020 and Tesla's 5:1 split the same year.
Forward vs Reverse Stock Splits
A forward split increases the number of shares and decreases the price proportionally (e.g., 2:1, 3:1). A reverse split does the opposite — it reduces the number of shares and increases the price (e.g., 1:5, 1:10). Reverse splits are often used by companies whose stock price has fallen below exchange listing requirements. While a forward split is generally seen as positive (indicating a high stock price), a reverse split can be a warning sign.
How Splits Affect Your Cost Basis
When a stock split occurs, your cost basis per share is adjusted proportionally. If you bought shares at $100 each and a 2:1 split occurs, your new cost basis becomes $50 per share. This is important for tax purposes — your total cost basis remains the same, but the per-share amount changes. Keep accurate records of stock splits for accurate capital gains calculations when you eventually sell.
Disclaimer: This calculator is for educational and informational purposes only. It is not financial advice. Always consult a qualified financial professional before making investment decisions.
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Common Use Cases
Stock splits are significant corporate events that every investor should understand. While a stock split does not change the total value of your investment, it changes the number of shares you own and the price per share, which affects future trading decisions, limit orders, and tax calculations.
This calculator makes it easy to see exactly how a stock split will affect your position. Whether it is a standard 2:1 forward split or a complex reverse split ratio, you can instantly see your new share count, adjusted price, and updated cost basis. This is particularly useful when companies announce upcoming splits and you want to understand the impact on your portfolio.
- Pre-split planning: Calculate your new position size before a company's announced stock split takes effect
- Cost basis tracking: Determine your adjusted cost basis per share for accurate tax reporting after a split
- Reverse split impact: Understand how a reverse split affects your share count and whether fractional shares will result
- Historical analysis: Calculate original share counts when researching companies that have split multiple times
What is a Stock Split?
A stock split is a corporate action where a company divides its existing shares into multiple shares. In a 2:1 forward split, each share becomes two shares at half the price. The total value of your position remains the same — you just own more shares at a lower price per share. Companies typically do this to make shares more affordable and increase liquidity. Famous examples include Apple's 4:1 split in 2020 and Tesla's 5:1 split the same year.
Forward vs Reverse Stock Splits
A forward split increases the number of shares and decreases the price proportionally (e.g., 2:1, 3:1). A reverse split does the opposite — it reduces the number of shares and increases the price (e.g., 1:5, 1:10). Reverse splits are often used by companies whose stock price has fallen below exchange listing requirements. While a forward split is generally seen as positive (indicating a high stock price), a reverse split can be a warning sign.
How Splits Affect Your Cost Basis
When a stock split occurs, your cost basis per share is adjusted proportionally. If you bought shares at $100 each and a 2:1 split occurs, your new cost basis becomes $50 per share. This is important for tax purposes — your total cost basis remains the same, but the per-share amount changes. Keep accurate records of stock splits for accurate capital gains calculations when you eventually sell.
Disclaimer: This calculator is for educational and informational purposes only. It is not financial advice. Always consult a qualified financial professional before making investment decisions.