"Apple closed its first trading day in 1980 at $22." True. And yet pull up Apple's December 12, 1980 close on Yahoo Finance right now and the number staring back at you is under $0.10. Same company, same date, two numbers that disagree by a factor of roughly 200. So who's lying?

Nobody. The culprit is the stock split. When a company splits its shares, charting tools reach back and redraw every historical price at the split ratio so the line never breaks across the split date. That redrawn figure is the "split-adjusted price" — and mistaking it for the price actually printed in the newspapers of the day is about the most common mistake people make reading equity history.

What it actually does, in one line: cut the share, cut the price

A split chops one share into several and divides the price by the same ratio. A 4-for-1 turns one share into four and knocks the price to a quarter. Think of swapping a $20 bill for four $5s — the wad got thicker, the money didn't. Market cap doesn't budge, and neither does what any shareholder is worth. The only thing that grows is the share count.

Why bother? Usually one of two reasons: the per-share price got high enough to feel out of reach for small investors, or the company simply wants to lower that psychological doorstep. Intrinsic value moves not one cent. What often does move, around the event, is trading volume and new-account buying.

Five splits that redrew the chart

1. Apple — cumulative 224x
1987 (2-for-1), 2000 (2-for-1), 2005 (2-for-1), 2014 (7-for-1), 2020 (4-for-1). Multiply it all out and one share from the 1980 IPO equals 224 shares today. That's the whole reason "the IPO close was $22" can't line up with a modern chart that puts the same dot down in low single-digit cents. The old newspaper number and today's chart number were never going to match.

2. Tesla — 5-for-1 in 2020, 3-for-1 in 2022
Just before the August 2020 split Tesla sat near $2,200; right after, around $440. On the chart it looks like the price cratered 80% while market cap sat there untouched — that gap is the split, nothing more. The 2022 3-for-1 pulled the same trick again.

3. NVIDIA — 10-for-1 in 2024
The June 2024 split landed in the middle of the AI rally and was the loudest one of the year. The price dropped from about $1,200 to $120 overnight. Count cumulatively and it's the company's sixth split since IPO.

4. Alphabet (Google) — 2014 class split + 20-for-1 in 2022
The July 2022 20-for-1 took the displayed price from the $2,200s down into the $110s. Unusually, the company came out and said the point was to strip away a psychological barrier for retail investors who saw the high per-share price as expensive in itself.

5. Amazon — three splits in 1998–1999, then 20-for-1 in 2022
Amazon split three times in barely more than a year in the late 1990s, then went quiet for 23 years before its 2022 split. For a whole generation of investors who'd never watched one happen, the chart suddenly redrew itself.

Three habits that keep splits from fooling you

1. Check whether you're looking at the adjusted close. Yahoo Finance, TradingView, Google Finance — nearly every free tool defaults to split-adjusted prices. On a heavily split ticker, the 1990s price you see on a modern chart is wildly off from the price that actually traded back then.

2. Old prices in books and papers usually aren't adjusted. A 1990s book that says "Apple was $30 then" is quoting the real number from that day. It won't match today's chart, and it shouldn't — the two are measuring different things.

3. A split is not, on its own, a bullish signal. This is where everybody gets caught once. Intrinsic value doesn't change. Yes, volume and retail buying tend to pick up around splits, but the jump from "a split happened" to "the price will go up" is way too big a leap. Personally, that's the misconception I find scariest.