Stock splits usually work, and the 20-for-1 split by Google’s parent company Alphabet may spark a wave.
That’s according to analysis from Bank of America, which found that companies that have announced stock splits have outperformed the market.
S&P 500 SPX, -1.81% stocks that have split, on average, have gained 25% over the next 12 months, compared to the 9% gain for the broad index.
Stock splits usually work, and the 20-for-1 split by Google’s parent company Alphabet may spark a wave.
That’s according to analysis from Bank of America, which found that companies that have announced stock splits have outperformed the market.
S&P 500 SPX, -1.81% stocks that have split, on average, have gained 25% over the next 12 months, compared to the 9% gain for the broad index.
Some $6.6 trillion in market cap, or 17% of the S&P 500, trades above $500 per share.
The analysis however does not mention the growing proportion of brokers offering fractional ownership, which makes the high cost of a single share of stock less of an issue for retail investors.