Happy Fin-Friday! The Nvidia stock is now one of the big 3 in the S&P 500. We've talked about Nvidia earnings and how much the stock price has soared just this year. Now they have announced a stock split and a dividend increase from $0.04 per share to $0.10 per share. Let's demystify stock splitting. 🔮

🍰 What Is A Stock Split?

A type of corporate action that changes the cost of a stock.

• Forward split - When a company increases the outstanding shares by issuing new shares to split up the value of each new share. NVDA did a 10 for 1 split (ie - if the stock is $1000 per share it is now $100 per share and everything rebalances everywhere), but companies can also do a 2 for 1, 3 for 1, etc. Say you had a sheet cake cut into 10 squares, but there are more people who want their own piece of cake, so you cut each piece in half and now there are 20 pieces of cake.
• Reverse split - It's the opposite, companies do this to increase the stock price (for example, if the stock price falls below $1)

Why Is Nvidia splitting their stock?

According to their 2024 Stock Split FAQ the stock split is intended to make stock ownership more accessible to employees and investors.

Investor Relations

You can look at the investor relations for any company on their website to see the history of things like how many times they have done a stock split (for example, Nvidia has split their stock 6 times now).

Let us know your questions around stock splitting or any other investing topic. And as always, keep learning, keep earning, and keep breaking barriers!

xoxo,

Fin-Mom & Fin-Auntie

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Market MakeHer is an investing education podcast taught by a 15-year finance expert to her friend who is a beginner investor. Our mission is to demystify the stock market and make financial literacy accessible to all self-directed investors! We believe that investing is for everyone and that's why we break down complex investing topics (from "Her" perspective), show you free tools/resources on our podcast, and offer a ton of free educational content on our ⁠website⁠!

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Finally, short squeeze and gamma squeeze make sense! (Did you know gamma squeeze was a thing?)

Also, Roaring Kitty is out of hiding, remember that whole GameStop stonks thing that happened? Well apparently it's happening again with another memestock (super high risk, y'all).

We also learn about hedge funds, meme stocks, market makers and the roles played in making money off shorting stocks (or squeezing out the shorters). Check out our episode on Dark Pools for more background. We also very briefly discuss Options!

Hedge funds are regulated and here's the link we mentioned for that: https://www.sec.gov/files/ib_hedgefunds.pdf

The Takeaway:

Shorting a stock is super risky. You're gambling on the failure of a company, essentially, and this tends to happen in hedge funds. A short squeeze is an event that happens when the people who are shorting stock shares have to cover the cost of the shorted stock because now the price is going up due to unforeseen demand (people suddenly buying it) and getting squeezed out of that position. It's like we always say, investing involves risk. ;)

Still Have More Questions or a Comment?

🙋🏾‍♀️🙋🏻🙋🏼‍♀️🙋🏽‍♂️🙋Holla @ us on:

⁠Market MakeHer ⁠⁠website⁠⁠⁠

Subscribe to Our Newsletter

Instagram⁠ ⁠⁠@marketmakeherpodcast⁠⁠⁠

TikTok⁠ ⁠⁠@marketmakeher⁠⁠⁠

X/Twitter⁠ ⁠⁠@MarketMakeHer⁠⁠⁠

Join the Money Coven⁠ ⁠⁠FB Community⁠⁠⁠

👀 Watch us in action on our⁠ ⁠⁠YouTube Channel⁠⁠⁠ 👀

About Us 🌚🌞

Market MakeHer is an investing education podcast taught by a 15-year finance expert to her friend who is a beginner investor. Our mission is to demystify the stock market and make financial literacy accessible to all self-directed investors! We believe that investing is for everyone and that's why we break down complex investing topics (from "Her" perspective), show you free tools/resources on our podcast, and offer a ton of free educational content on our ⁠website⁠!

Important Disclosures:

Market MakeHer podcast is unsponsored at the time of recording.

Tools and resources mentioned are for informational and educational purposes only. Remember, investing involves risk, and there's always a potential for losses when investing in securities.

Market MakeHer LLC provides educational content and resources, but we are not registered financial advisors and do not provide personalized investment advice. Consult with a licensed financial advisor before making any investment decisions.