Saw someone post stock splits are not a positive, is this true?

Certainly depends on why the stock is splitting, what the dilution effect ultimately is, etc. For "real" stocks of real companies, a split during a "real" growth phase (business is either experiencing significant, sustainable growth, profitability spikes and/or the valuation spikes), those splits are usually positive to very positive.

If the stock is splitting for other reasons - to reduce minority shareholders' ability to affect board composition or other backdoor, Machiavellian reasons and the common shareholder is getting screwed, then that's bad.

ETA: I read/responded solely to your comment, not the actual tweet. The tweet doesn't say what you suggest it says. It says that a split is not a factor in buying/selling the stock. No assessment/judgment on whether or not splits are positive. Regardless, I stand by my statement.

quote:

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The idea is to make stocks seem more attractive to investors, so there's often a run up in price due to increased demand when a split is announced.

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Which usually happens so I'd say its a positive in most cases.

Id say my purchase of AMZN, GOGG,TSLA right around their split dates has been a real big negative

Stock splits only mean something in a free money world where there's a ton of retail dumb money looking for a home, so the last 2 years, stocks would actually move based on the meaningless action. It's like I'm giving you a pizza split into 8 pieces instead of 6 pieces but the quantity of pizza is not changing at all. Only people not intelligent would pay more for the same amount of pizza.

Other than that, if you think people trading volume in options that don't have capital to afford the options for the higher ticker price, that's always been the one tangible thing people can throw in. However people with enough capital to move the needle on the needle thats on the needle, it doesn't effect.


So in summary, I'd say stock split momentum is a great indicator of how dumb or frothy a market is.