What is the result of a positive stock split?

A positive stock split occurs when a company divides its existing shares into multiple new shares, thereby increasing the total number of shares outstanding. The primary objective of this action is to make the stock more affordable and increase liquidity by reducing the share price while maintaining the overall market value of the company.

When a positive stock split happens, the market capitalization of the company typically remains unchanged immediately after the split, assuming no other market factors at play. Since each shareholder now holds more shares, but at a proportionally lower value per share, the total value held by a shareholder does not inherently increase or decrease due to the split itself. This leads to the perception that the stock is now more accessible to a broader range of investors, which can potentially drive demand and positively influence shareholder value in the long term.

In essence, while a positive stock split does not change the company's market capitalization or directly result in an increase in immediate monetary value, it can enhance shareholder value by making the stock more appealing to more investors.