Amazon Stock Split
Amazon ($AMZN) stock split is here. For many years investors and even speculators admired the stock but from a distance. At its peak, you had to fork out $3731.41 to own a single share. It’s been trading at around $2400 for the last month.
So a quick reminder. A split is when management believes the price of the stock might be keeping out many of those who would want to invest. They take a single unit and split it into smaller units. Those smaller units’ total value is equivalent to the value of the one stock that they split.
The Amazon split happened this morning. It was a 20:1 split. So now you have 20 stocks for every 1 you owned in Amazon.
Nothing fundamentally changes about a company at the split. Same valuation on the books, just more shares to trade.
What do you think, was the move just so be kind to smaller investors? Historical data shows that after a stock split, the company usually enjoys a boost in performance.
This split could provide some juice to the market too. Many headlines have been floating around about market crash and recession.
Many of us have prime accounts and shop weekly or monthly on Amazon. Some will see this as their chance to own piece of the pie that they have been spending their money to build.
Whatever you do, make sure that it is backed up by research and sound advice.