What does it mean when a stock splits and why are Amazon and Google doing them?

What does it mean when a stock splits and why are Amazon and Google doing them?

On Monday the stock closed at almost $125 a share

But Amazon shareholders actually didn't lose a penny on Monday

In fact, if they bought shares of Amazon on Friday and sold it on Monday

they would have come out ahead

since the stock closed higher

A stock split means a single share gets split into multiple shares

get an extra one or two shares equal to the previous trading price of one share.

But Amazon executed a 20-for-1 split. Here's what that means and why it could be lucrative for shareholders.

A 20-for-1 split means that Amazon shareholders

Since Amazon shares closed at $2447 on Friday

before markets opened on Monday the price of shares after the split went to around $122, or $2447 divided by 20.