100 shares ... $20 2:1 split goes to 200 shares that you own at $10
200 shares .... $10 3:1 split goes to 600 shares that you own at $3.33
If you have a brokerage account, and your stock contracts are electronic, than everything is usually already adjusted for you.
Your total cost on the shares is known and divide that by 600 in this example.
100@$20 = $2000 plus commission (say $2020)
2020/600= $3.36667 as your net per share cost.
That way, you do not have to sell all 600.
If you do, you still have the $2020 net cost.
(600 x $35)-Commission would be the proceeds.
Net proceeds minus net cost is the gain.
If you did a partial sale, use the $3.36667 per share as cost.
It is not difficult as long as you know what you originally paid.
How do you determine gains/ losses when stock split happens several times on stocks you own? For example if I bought 100 shares of stock for $20 and 2:1 happens and then 3:1 happens, this would mean I own 600 shares of stock. But now I decide to sell all 600 for its fair market value of $35, how do I determine gain or loss? Do I do (600 x $35) - (100 x $20) to calculate gain? I just wanna make sure I'm doing it right.
