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I'm a Bit Confused on the Stock Split

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Tesla, Inc states, "Each stockholder of record on August 21, 2020 will receive a dividend of four additional shares of common stock for each then-held share, to be distributed after close of trading on August 28, 2020."

I'm a bit confused by this statement. It sounds to me like one has to be a shareholder on or before the 21st of August to realize the split. What happens to any shares that are purchased between the 21st and the 28th?

One additional question: How are fractional shares handled with the split? If one owns 1/5 of a share before the split, one will then own an entire share after?

Thank you for any feedback.
 
Tesla, Inc states, "Each stockholder of record on August 21, 2020 will receive a dividend of four additional shares of common stock for each then-held share, to be distributed after close of trading on August 28, 2020."

I'm a bit confused by this statement. It sounds to me like one has to be a shareholder on or before the 21st of August to realize the split. What happens to any shares that are purchased between the 21st and the 28th?

One additional question: How are fractional shares handled with the split? If one owns 1/5 of a share before the split, one will then own an entire share after?

Thank you for any feedback.
Generally speaking, you are not the shareholder of record. It's usually Cede & Co. The 8/21 date only matters if you are actually listed on Tesla's official record as a shareholder, e.g. if you still hold founder's stock or something. Nasdaq will decide when the stock trades ex-dividend, sounds like it will be 8/31 but check with your broker or subscribe to the Daily List for details.

Fractional shares are a broker invention. I imagine each broker will just flow the 5:1 through, but again check with them to be sure.
 
I had similar question about someone who buys or sells after the record date but before the split date. It took me a fair bit of searching, but what I learned was:

The new shares are issued on the effective date to holders as of the record date.

On the NASDAQ there is a rule that if you sell between those dates you are obligated to deliver the new shares to the buyer.

On other exchanges, there is no such rule, and delivery of the newly-issued shares is a matter of contract between the buyer and the seller. Since everybody knows that the split is coming, when you buy shares you make sure that the contract includes a provision that you be given the new shares when they are issued. Presumably, if you buy or sell through a brokerage they'll take care of this and it will be seamless for you.
 
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