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SIE: Equity Securities
SIE practice questionmediumStock Splits

In a reverse 1-for-4 stock split, an investor holding 400 shares will now hold how many shares?

  1. A400
  2. B100✓ Correct answer
  3. C1,600
  4. D4
Explanation

Why B100

A 1-for-4 reverse split means every 4 shares become 1, so 400 shares are consolidated into 100. The other answers misapply the split ratio.

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