Shares of Apple and Tesla continued to rise on Monday, August 31, as investors seized the opportunity to take shares at more affordable prices after the companies split their shares (split), reports Reuters.
For Apple, this is the 5th split since its public offering in 1980, the previous stock split was 7 to 1 in 2014.
Split is the splitting of one share into several, while their value decreases proportionally. Companies are shredding stocks to make them more accessible to small-capital investors.
Shares of Apple rose nearly 30% after it announced an unexpected split 4 to 1 on July 30, rising another 2.6% to $ 127.99 on Monday.
This helped the iPhone maker overtake Saudi Aramco as the world’s most expensive public company and become the first US public company to exceed $ 2 trillion in market capitalization.
Electric car maker Tesla has also announced the division of its securities into smaller parts at a ratio of 5 to 1, which also takes effect on Monday.
Tesla shares have more than quadrupled this year, while General Motors and Ford Motor shares have fallen due to the effects of the COVID-19 pandemic.
Shares of Tesla, up 61% since the announcement of the stock split in mid-August, closed at $ 2213.4 on Friday. At the beginning of trading on Monday, they rose 3.2% to $ 456.90 (after crushing).
In recent years, the stock split on Wall Street has become a rarity: only three members of the S&P 500 have announced a split in 2020, compared to the average of ten companies per year over the past decade.