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> Retail traders that started "investing" in the last two years have been trained to believe that stock splits means a bunch of money will pile in because the p
by heleninboodler 4y ago
> Retail traders that started "investing" in the last two years have been trained to believe that stock splits means a bunch of money will pile in because the price looks cheaper
I have heard this exact thing debated since the late 80's, so I'm not sure what the last two years has to do with it. The fact is, whether there's a real effect there or not depends less on the precise math of the situation and a whole lot of behavioral and psychological factors. Splits goosing the stock price is a real thing that happens. It may be entirely self-perpetuating crowd-mind BS but it does still happen.
- adabyron 4y agoRetail has easier access to options & day trading now than in the 80's. Stock split results in much cheaper options, which many retail day traders seem to prefer. I might argue that a stock split to a cheaper price would increase your volatility due to the above. Though TSLA's current price might disagree with me as I think it's one of the most traded & is by no means cheap for options trading.