Investopedia

Continue to Site »

Bifurcation

Filed Under » ,
Dictionary Says

Definition of 'Bifurcation'

The splitting of a larger whole or main body into two smaller and separate units. Bifurcation can occur when one company divides into two separate divisions, thereby creating two new companies that can each issue shares to stockholders. Shareholders in the initial company are given shares of the new company through a corporate reorganization. Companies may seek bifurcation for certain tax advantages.

Bifurcation also refers to the analysis or evaluation of market conditions based on two distinct scenarios.

Investopedia Says

Investopedia explains 'Bifurcation'

Bifurcation, as it relates to finance, usually refers to the dividing of one company into two separate companies. This can provide tax advantages to the company as well as increased financial opportunities for shareholders. The term bifurcation has other applications in law, hydrology, fluid dynamics, mathematics, economics, chemistry, anatomy and physiology. In each application, bifurcation refers to the splitting in two of a certain element or system, such as the splitting of a single hydrogen atom participates into two hydrogen bonds.

Articles Of Interest

  1.

    Tax Tips For The Individual Investor

    We give you seven guidelines to help you keep more of your money in your pocket.

  2. An Evaluation Of Emerging Markets

    Get the full story on this asset class before you write it off as too risky.

  3. 10 Steps To Tax Preparation

    Follow these simple steps to get you ready for April 15.

  4. Understanding Stock Splits

    We explain what they are, the thinking behind them as well as their results.

  5. Don't Let Stock Prices Fool You

    Find out why a stock with a six-figure share price can still be a good value.

  6. How can I easily get ready for next year's tax season?

    You may one of the lucky ones to come out on top this tax season, but as you will likely agree, it does not mean that you should rest on your laurels. Instead, use the experience gained during ...

  7. What is a monopoly?

    Monopoly is a fun family game, but in real life, a monopoly can be dangerous to a country's economy. A monopoly occurs when an industry or sector has only one producer of goods or retailer for ...

  8. What is a stock ticker?

    A stock ticker is a report of the price for certain securities, updated continuously throughout the trading session by the various stock exchanges. A "tick" is any change in price, whether that ...

  9. Institutional Investors

    Learn more about the advantages that financial institutions enjoy when buying and selling securities.

  10. Weighted Average

    Learn how to weigh the relative importances of data points in a calculated average.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  2. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.

  3. Icarus Factor

    The term Icarus factor describes a situation where managers or executives initiate an overly ambitious project which then fails. Fueled by excitement for the project, the executives are unable to reign in their misguided enthusiasm before it is too late to avoid the failure.

  4. Angelina Jolie Stock Index

    An index made up of a selection of stocks from companies associated with actress Angela Jolie.

  5. Consequential Loss

    The amount of loss incurred as a result of being unable to use business property or equipment.

  6. Lease To Own

    An arrangement where an individual enters into a lease agreement with an owner with the inclusion of a clause that typically gives the individual the right, but not the obligation, to purchase the item leased at a predefined price and time.
Trading Center