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Handling Stock Splits

Stock splits occur when a company divides its shares, increasing the number of shares while reducing the price per share proportionally. Reverse stock splits consolidate shares, decreasing the number of shares while increasing the price per share proportionally. The tradeGIST add-on automatically adjusts historical transactions for both forward and reverse splits, ensuring accurate calculations without manual edits. This is especially useful for assets with many transactions, as it prevents the need to update volumes and prices individually.

How Stock Splits Are Handled​

The add-on adjusts the volume and price of every transaction before the split date proportionally. Your original transactions remain unchanged in the Transactions sheet — the adjustments are applied during Generate Trades — and trades after the split date are unaffected.

Example (Forward Split):

  • You buy 10 shares of NVDA at $500 on March 10th.
  • NVDA announces a 5:1 stock split on June 20th.
  • After running Generate Trades, the transaction shows 50 shares at $100 (adjusted for the split).
  • Any NVDA trades after June 20th remain as entered.

Example (Reverse Split):

  • You buy 100 shares of XYZ at $10 on January 1st.
  • XYZ announces a 1:10 reverse stock split on July 15th.
  • After running Generate Trades, the transaction shows 10 shares at $100 (adjusted for the reverse split).
  • Any XYZ trades after July 15th remain as entered.

How to enter Stock Splits​

To enable split adjustments:

  1. Go to the Configuration sheet, under "Stock Splits."
  2. Add a row for each split:
    • Date: The split date (e.g., "2024-08-08").
    • Ticker: The asset symbol (e.g., "MSTR").
    • Split Amount: The ratio (e.g., 10 for a 10:1 forward split, or 0.1 for a 1:10 reverse split).
  3. Run Generate Trades to apply adjustments. All transactions for that ticker before the date will be updated.

Note: Ensure dates have a "Date" format. For reverse splits, use fractional split amounts less than 1.

Impact on Option Contracts​

Stock splits also affect associated options:

  • Strike Prices: Adjusted proportionally (e.g., a $300 strike becomes $30 in a 10:1 forward split, or $30 becomes $300 in a 1:10 reverse split).
  • Contracts: The number of contracts may increase in forward splits or decrease in reverse splits (e.g., 10 contracts become 1 in a 1:10 reverse split).
  • Matching Trades: Pre- and post-split options can be matched in the same trade.

Example (Forward Split):

  • You buy "MSTR250117C00300000" (strike $300) before August 8, 2024.
  • After the 10:1 split, it adjusts to 10 contracts of "MSTR250117C00030000" (strike $30).
  • You can sell the 10 contracts on October 10, 2024, and they will match as one trade.

Example (Reverse Split):

  • You buy 10 contracts of "XYZ250117C00030000" (strike $30) before July 15, 2024.
  • After the 1:10 reverse split, it adjusts to 1 contract of "XYZ250117C00300000" (strike $300).
  • You can sell the 1 contract on October 10, 2024, and it will match as one trade.

Tip: Review adjusted options in the Trades sheet after running Generate Trades.

Troubleshooting​

  • Adjustments Not Applying: Confirm the split is configured correctly and run Generate Trades again.
  • Incorrect Ratios: Double-check the split amount (e.g., 2 for 2:1 forward split, 0.5 for 1:2 reverse split).
  • Options Issues: Ensure the root symbol matches the ticker.