Why has my average price decreased due to stock split?

When a company announces a stock split, it increases the number of shares and reduces the price per share, but the total value of your investment remains the same.

Here’s why the average price per share decreases after a stock split:

1. Increase in Share Count: After the stock split, the number of shares you own increases. For example, in a 2-for-1 split, you get two shares for every one you previously owned.

2. Adjusted Average Price: The price per share decreases because the total number of shares increases, and the price of each share is divided by the split ratio. For instance, if you originally bought shares at ₹10 and there's a 2-for-1 split, your average price per share will now be ₹5.

Example:

• Before the split: 100 shares at ₹10 each = ₹1,000 total value.
• After the split: 200 shares at ₹5 each = ₹1,000 total value.

The number of shares and the price per share change, but the total investment value stays the same.