The straight splits are both 2-for-1, meaning each ETF will end up having twice its presplit value. The ETFs and share price movements of each one in the past year are as follows:
- ProShares Ultra Nasdaq Biotechnology ETF (NYSEArca: BIB), a double-long fund that’s jumped 120 percent in the past year. Its post-split value, based on prices as of Sept. 24, will be around $64 a share.
- ProShares Short VIX Short-Term Futures ETF (NYSEArca: SVXY), a double-exposure short fund that has shot up more than 240 percent in the past year. Its post-split value based on prices as of Sept. 24 will be around $72 a share.
ProShares stressed in its press release that share splits don’t change the underlying value of an investment.
That said, regarding the reverse splits, shareholders who hold quantities of shares that are not an exact multiple of the 1-for-4 reverse split ratio will end up with fractional shares.
Post-reverse split fractional shares will be redeemed for cash and sent to a shareholder’s broker of record.
This redemption may cause some shareholders to realize gains or losses, which could be a taxable event for those shareholders, ProShares said.
All the funds will begin trading at their post-split prices on Friday, Oct. 5, and all will retain their existing ticker symbols.