Split shares consist of two types of shares based on an underlying common stock.the first type of share is based on the capital appreciation of the underlying stock,while the second type of share is based on the dividend that the underlying commonstock pays.typically, a large block of common stock would be held in trust by the creator of thesplit shares. the organization would then create two new shares: the capital shareand the equity dividend share.one difference between zero coupon bonds and split shares (other than the fact thatzero coupon bonds are debt instruments and split shares are equity instruments) isthat zero coupon bonds are actually components that were split apart from the originalbond.in other words, the original bond is now all in pieces. with split shares, however, theunderlying common stock is still in tact and two new shares are created that are relatedto various parts of the underlying common stock (i.e., the capital part and the dividendpart).
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