A stock split results in the reduction of the par or stated value per share and a proportionate increase in the number of shares outstanding.

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A stock split is a corporate action that involves a company dividing its existing shares into multiple shares. The par or stated value per share is reduced, but the total value of the shares remains the same. This results in an increase in the number of shares outstanding. For example, in a 2-for-1 stock split, each shareholder will receive two shares for every one share they currently own, but the value of each share will be halved.

A Stock Split Results in the Reduction of the Par