Corporate actions are events initiated by a company that affect its securities, such as stocks and bonds. These actions can include activities like dividends, stock splits, and mergers. They are important for shareholders as they can influence the value of their investments and their rights as owners. When a corporate action occurs, companies typically notify their shareholders and provide details on how it will impact their holdings. For example, in a stock split, a company divides its existing shares into multiple new shares, which can make the stock more affordable for investors. Understanding these actions helps investors make informed decisions.