Stock splits have become less common in recent years for a few reasons:
High share prices: Many stocks have seen their share prices rise significantly in recent years due to strong market performance and investor demand. As a result, companies may be hesitant to split their stock because they don't want to dilute the value of their shares or create a perception that the stock is overpriced.
Different investor preferences: Retail investors are no longer the primary purchasers of stocks. Instead, institutional investors and algorithmic trading systems now dominate the market. These types of investors are less likely to be influenced by a stock split and may not view it as an important factor in their investment decisions.
Reduced trading costs: The rise of online brokerages and the decrease in trading fees has made it easier and cheaper for investors to purchase stocks in smaller quantities. As a result, the need for stock splits to make shares more affordable has decreased.
Changes in regulations: In recent years, there have been changes to the regulations governing stock splits, which may make them less attractive to companies. For example, some rules require companies to obtain shareholder approval before splitting their stock, which can be time-consuming and expensive.https://one.exness-track.com/a/c_u64cu9lf26
Despite these factors, some companies still choose to split their stock, either to make shares more accessible to investors or to increase liquidity in the market. However, the trend towards fewer stock splits is likely to continue as long as these factors remain in place.
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