![]() Our thought bubble: Well, it depends on what you think the stock market is. And if you can't afford to buy a whole share of, say, Amazon, which last week was trading at around $2,500, you can buy so-called "fractional" shares, which allow you to buy, you guessed it, the fraction of the share that you can afford.Īnd, yet: Amazon's stock price rose roughly 2% Monday after its split, beating out the Nasdaq which was up just 0.4%. Today, stock trading is largely commission-free. During the tech stock boom of the late 1990s, stock splits rose in popularity and were often associated with huge surges in share prices - which, in hindsight, were simply a sign of the manic quality of the markets in that era. ![]() Trading smaller lots often meant paying much higher commission payments to brokerage firms. This was thought to be particularly important for individual traders, who sometimes didn't have the cash on hand to buy the 100-share lots that were the standard unit of stock trading. ![]() The backstory: Once upon a time, stock splits were a way for companies with soaring share prices to make it easier for investors to buy their stocks - and in turn, more buyers help prop up the price.
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