FINC314 Lecture Notes - Lecture 19: International Economic Review, Stock Split, Event Study

• School: University of Delaware
• Department: Finance
• Course: FINC314
• Professor: Danby Peter

Document Summary

Review all the way back in 1969 and the other published by professors de bondt and thaler in the. Journal of finance some years later in 1985. The adjustment of stock prices to new information. Theories are only as strong as the evidence which exists in support of them. With this truism in mind, the importance of the adjustment of stock prices to new information to the emh cannot possibly be overstated. Stock split: increases the number of shares and decreases the price per share (i. e. from 1 share to. Reverse split: decreases the number of shares and increases the price per share. This usually happens if you are about to be de-listed (once you drop under a certain price per share you will be dropped out of the stock market lists because people are fundamentally uncomfortable with cheap stocks)