If you trade US stock tokens on Mudrex, you may occasionally come across a corporate action called a stock split or reverse stock split. These are normal events that happen to real, listed companies, and because your Mudrex position tracks the price of the underlying stock, your position gets adjusted too.

This can look surprising if you don’t know it’s coming, so here’s a quick breakdown of what these events are, what happens on Mudrex when they occur, and whether you need to do anything about it.

What is a stock split?

A stock split increases the number of shares a company has outstanding while reducing the price per share by the same ratio. The total value of what a shareholder holds doesn’t change; it’s just divided into more, cheaper units. Companies typically do this to bring their share price down to a more accessible range for investors.

Example: In a 10-for-1 stock split, every 1 share becomes 10 shares, and the price per share drops to roughly one-tenth of what it was. If you held 1 share worth $100 before the split, you’d hold 10 shares worth $10 each after it, same total value.

What is a reverse stock split?

A reverse stock split does the opposite: it reduces the number of shares outstanding while increasing the price per share by the same ratio. Companies usually do this to raise their share price, often to meet a listing requirement or improve how the stock is perceived in the market.

Example: In a 1-for-10 reverse split, every 10 shares get consolidated into 1 share, and the price per share increases to roughly 10 times what it was. If you held 10 shares worth $10 each before, you’d hold 1 share worth $100 after- again, the same total value.

Why does this affect my Mudrex position?

Your US stock token on Mudrex is a contract that tracks the price of the underlying stock; it isn’t the actual share itself. So when the real company’s share count and price change because of a split, Mudrex adjusts your position to keep it accurately tracking the stock, using the same ratio as the actual corporate action.

Timeline: What to Expect

About 7 days before the adjustment
The stock split or reverse split is announced publicly by the company and reflected on Mudrex. This gives you advance notice before anything changes on your position.

During the adjustment (roughly 30 minutes)
At the scheduled time, trading on the affected asset is briefly paused while the position adjustment is carried out. You won’t be able to open, close, or modify positions on that asset during this window. This window is typically around 30 minutes but may occasionally take a little longer if needed.

Once the adjustment is complete
Trading resumes automatically. Your position quantity and average entry price will now reflect the new, post-split numbers.

What happens to your position

• Your position quantity and average entry price will change. This is expected and matches the split ratio; your position’s overall value stays consistent with the adjustment. It isn’t a gain or loss caused by the split itself.
• Any open orders, including Stop Loss (SL) and Take Profit (TP) orders, will be automatically cancelled at the start of the adjustment. This is a routine part of how the adjustment is processed, not an error.
• A small amount may be settled as a gain or loss. If your position size doesn’t divide evenly under the new ratio, a small leftover portion is settled at the prevailing market price so the rest of your position can be adjusted cleanly. This shows up in your position history as a distinct “Split Adjustment” entry with no fee charged.
• Your position will not be liquidated as a result of the adjustment itself. Positions on the affected asset are frozen and protected from liquidation for the duration of the adjustment window. Normal liquidation risk based on your account margin resumes once trading reopens.
• Your trade history from before the adjustment is not affected. Any orders that were cancelled during the adjustment will still be visible in your Order History, marked as cancelled, so you can review and re-place them if needed.

Steps you may need to take

• Re-place your Stop Loss / Take Profit orders after trading resumes, since these are cancelled during the adjustment and are not automatically restored.
• Review your adjusted position (quantity and average entry price) once trading resumes, to confirm it lines up with what you expect.
• Check your Order History if you had open orders on the asset, to see which ones were cancelled and decide whether to re-place them.
• Check your position history if you notice a small unfamiliar PnL entry around the time of the adjustment; it’s likely the split settlement described above.
• No action is needed during the adjustment window itself; trading will resume on its own once the process is complete.

A few things to keep in mind

• Mudrex US stock tokens are price-tracking contracts. Holding one does not give you ownership of the underlying stock or any shareholder rights such as dividends or voting rights.
• Stock splits and reverse splits are designed to be value-neutral; they change how your holding is denominated (more units at a lower price, or fewer units at a higher price), not what it’s worth. The one exception is the small settlement described above, which can result in a minor gain or loss.
• As always, keep sufficient margin in your account, since normal market risk and liquidation rules continue to apply once trading resumes.