I'll throw in with that.
First, I don't see how a split creates liquidity since no new shares are
being sold. As I understand it, it's a board decision to halve the value
of a share thereby doubling the number already in existence. Wouldn't it
be nice if a corporation could create liquid capital just by cutting its
share price?
Second, a stock split lowers price per share allowing more investors to
buy a greater number of shares. This has the common effect on share
price -- an increase.
Third, a corporation will not split its shares unless it has a pretty
damn good idea that it expects a few good fiscal years ahead. This
because a downward fluctuation of say 1/4 point is multiplied by the
number of shares. The more shares, the greater the damage to the asset
column.
Finally, investors are more likely to buy shares at a low or mid-range
price than a very high price. To keep the share price going up steadily,
the board should split when it can.
Just a thought or two,
Keith