Tesla Stock Split (Should you Buy?)

Today Tesla (TSLA) announced they will do a 5 to 1 stock split, this means for each share you have, you will get 4 more. This will drop the price from $1,400 per share to around $290. 

Why Did Tesla Do This? 

Tesla announced Tuesday August 11, 
“Tesla, Inc. (“Tesla”) announced today that the Board of Directors has approved and declared a five-for-one split of Tesla’s common stock in the form of a stock dividend to make stock ownership more accessible to employees and investors. Each stockholder of record on August 21, 2020 will receive a dividend of four additional shares of common stock for each then-held share, to be distributed after close of trading on August 28, 2020. Trading will begin on a stock split-adjusted basis on August 31, 2020.”

This will drop the price and make it more affordable now new investors and employees. After the announcement Tesla stock (TSLA) jumped 8% then fell off 2%. 

My Thoughts 

I think that this is a overreaction in the market and there is a lot of FOMO in the market because people don't wanna miss another opportunity in the stock market.  
Also this doesn't change the value of the company. I think that if people wanna buy the stock, they should use dollar cost averaging to get the best share price. 


Popular posts from this blog


How to Start Investing in Stocks?