What is a spin-off, and how does etoro handle them?

A spin-off is the creation of an independent company through the sale or distribution of new shares of an existing business or division of a parent company. When a corporation spins off a business unit that has its own management structure, it sets it up as an independent company under a renamed business entity.

The spin-off companies are expected to be worth more as independent entities than as parts of a larger business.

This corporate event may affect the stock rates on the day of the spin-off.

How does etoro handle a spin-off?

If the spun-off company can be supported by etoro and its providers, we will add the asset to etoro. Clients who hold positions in the underlying asset may receive shares in the spun-off company added to their portfolio.

Corporate actions such as spin-offs may have tax implications for your account. We recommend seeking independent tax advice relevant to your circumstances. etoro does not provide tax advice, and the information provided should not be interpreted as such.

What if I hold a CFD?

• If you hold CFD buy positions, you’ll receive the cash equivalent.
• If you hold short positions, we’ll remove the cash equivalent from your available balance.

If you receive the cash equivalent, you can see the payment on your portfolio’s history page immediately after it’s made, or the following day on your account statement.

Learn how Stock Margin positions are handled in the event of a spin-off