| Split Adjusted |
|
A modification made to a security's price that takes into consideration the effect
of a split on the total number of shares or units outstanding, in order to compare the
security's current price to its historical price in a consistent form of valuation. In order to
adjust a security's price, the post split price would be multiplied by the split ratio (or
ratios if multiple splits had occurred) in order to get a split-adjusted price.
While stock prices most often are referred to as split-adjusted, options on underlying split stocks are also split-adjusted by increasing the number of shares covered by the terms of the option. This conversion is done by the same split ratio as the underlying shares, and the strike price is divided by the split ratio. |
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