Odd-Lot Trading Activity and Nominal Stock Price

57 Pages Posted: 8 Sep 2020 Last revised: 5 Aug 2021

See all articles by Kalok Chan

Kalok Chan

CUHK Business School

Jinming XIE

Department of Finance, Business School, TheChinese University of Hong Kong

Date Written: July 24, 2020

Abstract

We examine the rising of odd-lot trading activity and nominal stock prices in recent years. We find that odd-lot trading activity is positively associated with nominal stock price, on both cross-sectional and time-series basis. After a stock split (reverse split), the odd-lot trading activity decreases (increases) significantly. The positive relationship between odd-lot trading activity and nominal stock price holds for both common stocks and ETFs, and for retail investor trades. For higher priced stocks, there is a higher percentage of odd-lot trades with transaction price occurring within NBBOs.

Keywords: Odd-lot trade, nominal stock price, stock splits, NBBO

JEL Classification: G12, G14

Suggested Citation

Chan, Kalok and XIE, Jinming, Odd-Lot Trading Activity and Nominal Stock Price (July 24, 2020). Available at SSRN: https://ssrn.com/abstract=3659771 or http://dx.doi.org/10.2139/ssrn.3659771

Kalok Chan (Contact Author)

CUHK Business School ( email )

Hong Kong
852 3943 9988 (Phone)

Jinming XIE

Department of Finance, Business School, TheChinese University of Hong Kong ( email )

Shatin, N.T.
Hong Kong
Hong Kong

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
152
Abstract Views
836
Rank
307,470
PlumX Metrics