Stub (stock)
A stub in stocks is like a little piece of paper that tells you that you own a small part of a company. It's like owning a little piece of a pie. When you buy a stock, you become a part owner of the company. And when you sell it, you're selling that little piece of ownership back to someone else.
A stub stock is a special type of stock that's given to people after a company goes through a big change, like a merger or a split. Think of it like a leftover piece of pie. When a company merges with another company, it can create a new company with new stocks. Stub stocks are given to people who owned shares of the old company but didn't get any shares of the new company. They're like a little piece of the old company that still exists.
So, let's say you owned a share of a company that merged with another company. After the merger, you would have a choice of getting shares in the new company or getting a stub stock. The stub stock would represent a little piece of the old company that still exists, even though it's not the same as the new company.
Overall, stub stocks are a way for people to hold onto a little piece of a company after a big change, like a merger or split. They might not be worth as much as the new company's stocks, but they're still a way to hold onto a piece of the pie.
A stub stock is a special type of stock that's given to people after a company goes through a big change, like a merger or a split. Think of it like a leftover piece of pie. When a company merges with another company, it can create a new company with new stocks. Stub stocks are given to people who owned shares of the old company but didn't get any shares of the new company. They're like a little piece of the old company that still exists.
So, let's say you owned a share of a company that merged with another company. After the merger, you would have a choice of getting shares in the new company or getting a stub stock. The stub stock would represent a little piece of the old company that still exists, even though it's not the same as the new company.
Overall, stub stocks are a way for people to hold onto a little piece of a company after a big change, like a merger or split. They might not be worth as much as the new company's stocks, but they're still a way to hold onto a piece of the pie.