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A stock is just an arbitrary fraction of the capital stock, therefore the price in absolute value of a single stock is completely irrelevant. Suppose a company
by lottin 11y ago
A stock is just an arbitrary fraction of the capital stock, therefore the price in absolute value of a single stock is completely irrelevant. Suppose a company has a market value of $1,000. The company can divide its stock into 1,000 one-dollar shares, or into 500 two-dollar shares. Either way in makes no difference as far as the total worth of the company goes.
- the_holy_grail 11y agoThank you for the elementary school lecture. You are completely right: This is why companies are so eager to do a stock split at $6. It's all just arithmetic!
- reddytowns 11y agoThe NASDAQ market, which AMD is in, and the NYSE require that the price of its stocks are traded at or over $1 to avoid delisting.