Newspaper article The Daily Yomiuri (Toyko, Japan)

Stock Splits Surge to Attract Investors

Newspaper article The Daily Yomiuri (Toyko, Japan)

Stock Splits Surge to Attract Investors

Article excerpt

More and more publicly listed companies are carrying out stock splits this year, hoping to attract a wider range of investors by lowering the minimum amount needed to buy stock.

Some firms have seen their stock prices rise after announcing a split due to anticipation the move will make stock purchases more attractive to individual investors.

Kyocera Crop. plans to split each share held by investors who are stockholders on Monday into two shares. It is to be the firm's first stock split since May 1984, through which it is aiming to both increase investors and facilitate trades.

It took about 1 million yen to buy 100 shares of Kyocera stock in September, but the stock split would reduce this amount by half, to about 500,000. yen

Calbee Foods Co. is also planning a stock split Monday that would divide one share into four, and the Japan Exchange Group Inc. is planning to split each share into five.

In stock splits, companies divide existing shares to increase the number of shares issued. But there have been problems with stock splits in the past, such as when Livedoor Co. split each share into 30,000 shares, so domestic bourses ask firms to refrain from extreme splits not to cause confusions among investors.

The increase in stock splits comes after domestic stock exchanges urged listed companies to reduce the mini-mum investment to less than 500,000. yen

Some firms that have seen their stock prices rise during the recent climb of domestic stock markets are complying with the request and carrying out stock splits.

Another factor is the launch in January of Nippon Individual Savings Accounts, a system that will make dividends from stocks and other investments of up to 1 million yen tax exempt. …

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