Amazon Shares Rise After Stock Split
Amazon.com, Inc. (NASDAQ:AMZN) shares rose sharply shortly after Monday’s market open as a lower share price invites retail investors.
Shares of the Seattle-based eCommerce behemoth rose 4% early in Monday’s trading session after a 20-for-1 stock split.
While a stock split does not change the fundamentals, nor does it materially improve prospects for the business,
stock splits have recently been shown to increase retail trader interest in tech giant stocks and therefore promote share price appreciation.
“Evidence suggests that stock-split events drive additional participation from retail investors, especially in securities with
larger market capitalization,” a recent data analysis by the Chicago Board Options Exchange explained. “Volume in mega-cap equities initially spiked 342% the week immediately after the split.”