This is the record date for Tesla’s stock split. What this means.

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The

Tesla

three for one stock split is approaching and cornerstone was crossed Wednesday — the record date.

The record date is essentially the day Tesla (ticker: TSLA) looks to see who its shareholders are. Investors must be on this list to be eligible for the dividend.

But Tesla stock is likely to trade 130 million shares between Wednesday and August 24, when the ex-dividend date is reached – which is the day when buyers are no longer entitled to receive a stock dividend, or any dividend for that matter.

So what happens to Tesla stock buyers over the next few trading days?

Nothing really. For starters, most investors aren’t on that list. Many stocks are held in the name of brokerage companies. Owning shares in “Street Name” is common and helps eliminate the need for physical share certificates. The broker keeps track of which clients own shares held in the broker’s name.

What’s more, people are allowed to buy and sell Tesla stock in the coming days and still qualify for the dividend until the ex-dividend date.

In the case of the Tesla split, that date is August 25. So people who buy shares on August 24 qualify. People who buy Tesla stock on August 25th don’t.

But that doesn’t matter. Shares will trade at a third of their 24th close. There is no arbitrage opportunity associated with a stock split.

That’s not to say investors don’t like stock splits. Bulls believe that separation signals something positive for the future. In theory, managements don’t split stocks if they expect them to fall.

The last time Tesla stock split in 2020, the stock rose more than 80% from the time of the declaration to the ex-dividend date. It was an amazing run. This time, Tesla shares are up about 5% after the announcement. The S&P 500 rose about 3% over the same period.

There’s less juice in this stock split, in part because the company has been talking about it since March.

Market “logistics,” for lack of a better phrase, are of little importance to most investors. Record dates, former dates and the like are small details. These are taken care of so investors can focus on the fundamentals.

Write to Al Root at allen.root@dowjones.com