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Bonus and Split

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  #1  
Old 20th June 2008, 09:18 PM
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Default Bonus and Split

Hi,
I would like to know when the company offers Bonus or Splits, what actually happens to the market value of that share..does it get traded automatically half its price( example -if bonus/split - 1 share split into 2)? OR the exchange adjusts the price?

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Old 20th June 2008, 09:25 PM
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Default Re: Bonus and Split

Quote:
Originally Posted by Analytics View Post
Hi,
I would like to know when the company offers Bonus or Splits, what actually happens to the market value of that share..does it get traded automatically half its price( example -if bonus/split - 1 share split into 2)? OR the exchange adjusts the price?

It will be traded around half the price on ex-date.
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Old 22nd June 2008, 09:01 PM
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Default Re: Bonus and Split

it is traded at 5-10 % more than half the price, generally speaking. It if it were exactly half, then giving a bonus would not be of much use!!!
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Old 4th October 2008, 08:34 PM
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Default Re: Bonus and Split

and would sum1 pls explain that why do companies issue bonus while after bonus total market cap remains the same.
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