What is a stock split and when does it usually occurs?

Stock split can be understood as an addition of more outstanding shares to the existing shareholders. It is generally done when a company experiences an increase in the price per share.

Explanation:

A stock split, in most common languages, can be understood as a splitting of the outstanding shares because of the price rise in these shares. This splitting of shares is done by the board of directors of the company to increase the number of shares. The most important reason is to make the shares affordable to the investors and not influencing the capital of the company. The stock split usually happens when any company experiences an increase in the per-share price and when it is found that the price has increased beyond the estimated limit of the company or is higher compared to similar other companies in the same market.

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