Stock splits & reverse stock splits where maintain the total wealth of a shareholder to be same, adjust increase in no. of stocks by proportionate decrease in the price and decrease in no. of stocks by proportionate increase in the stock price. Companies in order to avoid de-listing or increase shareholder confidence sometimes do stock splits or reverse stock splits. The article, link provided at the bottom, discusses one such strategy which has been explained in the CFA curriculum. It tells how reverse stock split can increase the stock price for Grubb & Ellis and can maintain its listing on NYSE.
Read the article here: "http://www.crainsdetroit.com/article/20111220/FREE/111229994"
Read the article here: "http://www.crainsdetroit.com/article/20111220/FREE/111229994"
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