Breaking: A Reverse Stock Split Initiated by VEREIT, Inc.
On Thursday, December 17, 2020, as soon as the trades in the stock market are over, VEREIT, Inc. will implement the reverse stock split:
Five stocks will be consolidated according to the 1:5 ratio. In other words, five stocks of the company will become one new stock, the price of which will be increased by the factor of five.
These stocks will already be traded at the new prices on Friday, December 18, 2020.
Reverse stock split is when two or more stocks consolidate into one. This results in an increase in the market value of the stocks.
Effect of the Reverse Stock Split
Following the reverse stock split, the number of securities belonging to those customers who had open positions involving the aforementioned stocks will decrease by a factor of five. The price per one stock will increase, accordingly.
If the customer’s volume of the open order in terms of these stocks is not divisible by five, the orders, the volume of which became divisible by five, will be partially closed.
E.g. If the trader purchased 100 CFDs on VEREIT, Inc. stocks on December 10, 2020, as of December 18, 2020, his/her portfolio will have 20 CFDs on these stocks at the price which is 5 times higher than it was previously.
If he/she purchased 102 СFDs, the order for 2 stocks will be partially closed, and on December 18, 2020, his/her portfolio will include 20 СFDs on stocks issued by this company.
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