OK, I'm still like 100 posts behind so maybe someone else has smacked down this disinformation already but here are facts from personal experience: In the summer of 2011 I short Eastman Chemical (EMN). When they paid cash dividends my account was debited the amount of the cash dividend on the payment date. EMN declared a 2:1 split which was in the form of a stock dividend that took place in October that year. On the ex-dividend date of the split my account simply showed that I was short twice as many shares as the previous day (at ~ half the price). I took no action whatsoever. I certainly didn't cover - if I had it would have been profitable but I was dumb and managed to keep holding until I closed at a loss. This was in a TD Ameritrade account. Not only did I not have to take any kind of action, but I also don't remember the broker even sending me any kind of message about my position before or after.
Other than the rally that's happened, this is a nothing burger for everyone including the shorts, option holders etc.
The split will create a little actual buying pressure because not everyone has access to fractional shares. My wife's 401k for example doesn't have fractional shares and since there is a fixed contribution limit each year, it can't get fully invested in TSLA since they must be purchased in integer shares. Right now there is just under $700 of cash in that account which wasn't enough to buy another share earlier this year when the contribution was made. After the split, chances are that 1 or 2 shares will be purchased. Next years contributions will also be much more close to fully invested in TSLA than if it hadn't split since 7000/1500 has a large remainder.
