Apple announced in its fiscal third-quarter earnings that the Board of Directors has approved a four-for-one stock split. Apple stock currently trades above $450, it means investors should expect to again have a chance to buy a share of Apple for around $110, depending on where the stock trades at the end of August.

To understand the concept of stock investment, some investors acquire knowledge by taking online courses like "Growing Wealth With Stocks" and reading Books like "Growing Wealth Passively" 

The iPhone giant announced after the market closed Thursday that its board approved a 4-for-1 stock split for every shareholder of record at the close of business on August 24. This means each Apple shareholder will receive three additional shares for every share held. Shares will begin trading on a split-adjusted basis on Aug. 31.

A stock split doesn't change the underlying value of the company, it just lowers the share's price. For every share a shareholder owns, they will now own four. However the value of the shares will be one-fourth what they had been. The value to existing shareholders is that it adds liquidity and makes the shares more affordable to new investors.

It also signals to the market that the stock price has been rising. Investors want stocks with positive momentum. So, this tells investors that the stock has done well and can now be bought at a cheaper price.

Stock splits remain relevant for companies that want to bring in a wider base of shareholders, especially ones who had been put off by the high share price. Based on today's closing price, after the split Apple's shares would cost $116 a piece. Lowering the share price increases demand, especially among retail investors who want to own the stock, but couldn't afford to pay $464 for a single share. Increased demand typically causes a stock's price to rise. And this is how the existing shareholders benefit from the stock split.