A stock split is when a company increases its shares by dividing existing shares.
For example, a 2-for-1 split means that the price of each share is halved (e.g. from $1,000 to $500).
If you own 100 shares, you’ll own 200 shares by the end of the stock split.
But what if you have placed a stop order (e.g., stop limit, trailing stop order) with “GTC” before a stock splits?
In this guide, you’ll learn what happens to a stop order, stop limit, stop loss, or trailing order when a stock splits (Robinhood, WeBull, etc.).
What Happens to a Stop Order When a Stock Splits?
Your stop order will be automatically canceled by your broker before a stock splits.
This includes a stop loss, stop limit, trailing stop order, etc.
This applies to the majority of brokers including Robinhood, WeBull, MooMoo, and others.
After a stock splits, you need to place your stop order again when the market opens.
Your broker will not adjust your stop loss for you—you’ll have to place it again manually.
This is because the stock’s price and your average cost will be changed after the split.
Note: For more information on stop orders after stock splits, you need to contact your broker for assistance.
Editor’s note: I’ve used multiple brokers before and they canceled my stop order the same day when the stock is about to split.
Further reading
Beginner’s Tutorial to Use Moomoo
