TOKYO, Apr 03 (News On Japan) - With Japan's Nikkei hovering close to the 40,000 mark, market experts point out that the increasing trend of "stock splits" in recent years is supporting these higher stock prices.
Monex Securities' Chief Strategist, Takashi Hiroki: "It becomes easier for people who don't have a lot of money to buy shares. Naturally, the share prices of companies that undergo stock splits tend to rise. The biggest incentive for companies to split their stocks is the introduction of the new NISA system. There is an expectation and anticipation among companies that a lot of individual investors will start buying individual stocks because of this."
For instance, Mitsubishi Heavy Industries, which underwent a 10-for-1 stock split on April 1st, saw its minimum investment amount drop from 1.35 million yen to 140,000 yen.
Furthermore, over the past decade since fiscal year 2012, companies that have split their stocks have seen an average increase of 6% in the number of shareholders in the following period.
Hiroki: "Especially considering the influx of funds through NISA, the benefits for companies are significant. Therefore, I believe we will see a significant increase in companies opting for stock splits moving forward."
Source: ANN