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What is a demerger?

A demerger is when a company’s various operations are split into multiple components. This happens for a variety of reasons, including:

  • A desire to restructure and minimise production costs
  • Government intervention due to antitrust laws

At XM, when a demerger happens, we treat it like a cash adjustment, where the value of the adjustment is based on the value of the demerger. In such cases:

  • For long positions, you will be credited the calculated amount
  • For short positions, you will be debited the calculated amount

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