About this document
The Journal of Finance - December 1987 - LAMOUREUX - The Market Reaction To Stock Splits by zhouyuhe7 is a document available to read on EtoBox.
This paper presents a model explaining market reactions to stock splits, asserting that the announcement of a split leads to increased trading volume and volatility, which enhances the tax-option value of the stock. Empirical evidence supports the theory that splits generate positive abnormal returns despite associated risks and reduced liquidity. The findings suggest that stock splits serve as a mechanism for management to optimize shareholder wealth by increasing the stock
- Author
- zhouyuhe7
- Language
- EN