3 ms·
There’s also a non-trivial amount of stock price that’s based on “psychologically round” numbers. If a stock is 399 some traders may see it as a deal and buy si
by joshspankit 4y ago
There’s also a non-trivial amount of stock price that’s based on “psychologically round” numbers. If a stock is 399 some traders may see it as a deal and buy simply because it’s below the “round” number of $400. Splitting changes the relative landscape of what numbers are “round”.
- sbf501 4y agoI bet it is literally phonetically easier for traders on the NYSE floor to shout round number rather than "Selling amazon at 978.23!!!" At some point the number of significant figures slows down your transaction speed, as a human, that is.