Stock splits, enticements to investors in bull markets fordecades, have been pushed to the brink of extinction by chiefexecutive officers still recovering from the 2008 financialcrisis.

Four companies in the Standard & Poor's 500 Index splittheir shares this year and 16 did in 2011, down from an average of35 from 2004 through 2007 and a fraction of the 102 in 1997, datacompiled by S&P and Bloomberg show. The disappearance of splitsless than five years after stocks began their biggest plunge sincethe Great Depression underscores changing behavior by CEOs as wellas individuals who haven't returned to equities.

“There's a reluctance to split a stock after such a decline isstill fresh in the collective memory of management,” said DougRamsey, the Minneapolis-based director of research at LeutholdGroup LLC, which oversees about $3.5 billion. “A stock split isjust an accounting mechanism, but the psychology behind it is,you're not going to do it unless you're confident you're going totrade at an elevated level.”

While the bull market that began in March 2009 has restored morethan $8 trillion to American stock values and pushed the S&P500 within 15 percent of a record high, the lack of splits helpedsend the average price of shares in the S&P 500 to a record$58.52 apiece on April 30, more than two decades of data compiledby Bloomberg show. That's 9.1 percent higher than when the indexreached its all-time high of 1,565.15 in October 2007 and 31percent above the index peak in 2000.

Splits, designed to attract investors by making stocks moreaffordable through the issuance of extra shares, are evaporatingalong with equity volume.

Trading on all U.S. exchanges fell to 6.73 billion shares a daythis year from 9.99 billion in the second half of 2008, datacompiled by Bloomberg show. Higher prices reduce volume by creatingpsychological barriers for investors who weigh purchases inincrements of dollars, according to TD Ameritrade Holding Corp.

Both have proven painful to investment banks and exchanges andreduced profit opportunities for newer entrants such ashigh-frequency traders. Revenue from equity sales and trading forthe 14 biggest securities firms tracked by Bloomberg fell 36percent since 2007 to $48 billion last year.

First-quarter net income at NYSE Euronext, the biggest Americanstock market operator, decreased 44 percent as U.S. stock tradingtumbled 23 percent from a year ago. Nasdaq OMX Group Inc., thesecond-largest U.S. equity exchange owner, missed analyst estimatesfor profit during the first three months of the year.

Recession Trauma

About 20 percent of S&P 500 companies split stock in 1997,S&P data show. On average, 12 have done so each year since2009, after an 18-month recession spurred by more than $1 trillionof bank losses and writedowns tied to subprime mortgages. With theS&P 500 up 102 percent since the 12-year low in March 2009, theeffect has been to push 47 stocks above $100 a share, a record,according to Bloomberg data going back to 1990.

Apple Inc., which hasn't split since 2005, is up 41 percent thisyear to $569.48, crossing $600 for the first time in March. Thegains boosted its market capitalization by more than $250 billionin the four months through April 9, more than InternationalBusiness Machines Corp.'s entire value, data compiled by Bloombergshow. The Cupertino, California-based company's total market valueis $532.5 billion.

Priceline.com Inc., which converted six shares into one in 2003as its stock hovered around $2, trades for $737.65, the highestprice in the S&P 500. The Norwalk, Connecticut-based travelreservation system remains 24 percent below its Internet bubblepeak of $974.25, adjusted for the reverse split.

Chipotle Mexican Grill Inc., with the sixth-highest price in theS&P 500, has never split its stock in the six years since itbecame a standalone company, data compiled by Bloomberg show. TheDenver-based restaurant operator reached an all-time high of$440.40 on April 13 and gained 21 percent in 2012, more than twicethe S&P 500.

“Splitting is nothing more than window dressing,” Chris Arnold,a spokesman for Chipotle, said in an April 30 phone interview. “Itdoesn't change or add value for anybody, not customers, not thecompany and not shareholders. Doing these things to manipulate theprice in a way that doesn't create value just to make it accessibleto a few more people is really unimportant to us.”

'Attractive Investment'

McDonald's Corp., which spun off Chipotle in 2006, split sharesfor the 12th time in 1999, with then-CEO Jack Greenberg citing thecompany's “desire to continue to position McDonald's as anattractive investment for individual investors — customers,employees, franchisees and suppliers.” McDonald's split five timesin the 1980s, never letting the stock climb higher than$106.88.

Companies that avoid splits even when prices soar encourageinvestors to think like owners instead of traders, says billionaireinvestor Warren Buffett, whose Berkshire Hathaway Inc. Class Ashares trade above $120,000. Even he conceded to investor demandfor lower-priced stock by adding Class B shares that were worthabout 1/30th the equity value when introduced in May 1996. He splitthose 50-for-1 in 2010 to facilitate the takeover of BurlingtonNorthern Santa Fe. They gained 8.1 percent to $82.47 this year.

Higher prices make the market less welcoming for individualsafter they were battered by two bear markets in the last decade andone of the most volatile years on record in 2011, said ChristopherNagy, managing director for order routing, sales and strategy atonline brokerage TD Ameritrade.

“This is starting to be a real big issue for retail investors,”Nagy, based in Omaha, said in a phone interview. “There's thisphenomenon going on where there's hardly any trades in themarketplace, volume is at 10-year lows, and a lot of that can beattributed right back to share pricing.”

Trading at discount brokerages has slowed since the financialcrisis, according to data on E*Trade Financial Corp. and TDAmeritrade compiled by Barclays Plc. At 537,636 transactions perday in March, volume was 15 percent below a high in October 2008.Charles Schwab Corp. wasn't included because it changed toquarterly reporting of daily trades from monthly in 2010.

Instead of creating stock to bring prices down, four companiesin the S&P 500 combined shares in 2011, the most in data goingback to the mid-1990s. Consolidations by Citigroup Inc. last yearand American International Group Inc. in 2009, aimed in part atfrustrating strategies used by so-called high-frequency traders,have reduced market volume. Citigroup's reverse split aloneaccounted for about 6.1 percent of lost U.S. volume in the lasteight months of 2011, compared with 2010, according to RosenblattSecurities Inc.

Citigroup Slows

Daily trading in New York-based Citigroup has shrunk more thanthe 90 percent reduction that would naturally occur after a1-for-10 reverse split, data compiled by Bloomberg show. CEO VikramPandit said last month part of the reason for the change was to“encourage institutional and other long-only buyers of the stock toinvest in our company and also to discourage high- frequencytrading that fuels volatility.”

The stock traded at an average price of about $54 in the secondhalf of the 1990s and split four times, twice at about $60 and theother two times when it topped $70, according to data that hasn'tbeen adjusted for the splits.

When Google Inc. announced its split last month, it wasn't toappease stockholders. Instead, the company said it created a classof nonvoting shares to exchange for options owned by employees, sothat redemptions wouldn't dilute the control of its top executives.After issuing the new stock, shares of the Mountain View,California-based search engine operator will be cut in half frommore than $600.

The board of Coca-Cola Co., the world's largest soft-drinkmaker, recommended splitting the company's stock 2-for-1 lastmonth. The issuance “reflects our desire to share value with anever-growing number of people and organizations around the world,”said Muhtar Kent, the company's CEO.

The lack of splits coincides with the rise of exchange-tradedfunds, which don't care about the price of the shares they buy,said Jim Russell, the Cincinnati-based chief equity strategist atU.S. Bank Wealth Management, which oversees about $116 billion.

Investors have put $56.1 billion into ETFs in the last 3 1/2years, according to Cambridge, Massachusetts-based EPFR Global, amarket research firm. Still, that's just one-fifth of the $273.1billion they have pulled out of equity mutual funds over the sameperiod, data through April 25 show.

'Sloppy' Trend

“The market has turned more institutional,” Russell said in aphone interview on April 26. “As more companies are less concernedabout stock splits and stock splits are a natural volume creator,you could see the trend in volume continuing to be sloppy.”

Volume has been swayed in the last decade by the rise ofcomputerized strategies for market making and arbitragecumulatively known as high-frequency trading. Those techniques arepart of transactions accounting for as much as 53 percent of theshares that change hands daily on U.S. markets, according to NewYork-based research company Tabb Group LLC.

Rising share prices can create the impression volume isdeclining even when investors are spending about the same onequities. While volume on all U.S. exchanges has slumped 38 percentbetween the first half of 2009 and this year, the value of sharestraded is down only 4 percent, according to data compiled byBloomberg.

“A dollar invested is a dollar invested, I don't care if it's a$100 stock or a $1,000 stock,” Michael Gibbs, Memphis,Tennessee-based co-head of the equity advisory group at RaymondJames & Associates Inc., said in a telephone interview on April26. His firm oversees about $372 billion in client assets. “A lotof retail investors don't take that approach,” he said.

“But I don't think that just because stocks are not being splitor they are too expensive would keep investors out of the market,”Gibbs said. “It might push them to other stocks. The reason they'renot in the market is the decade they suffered.”

More than $6 trillion was added to American equities fromSeptember 2003 to the market peak in October 2007, data compiled byBloomberg show. While the S&P 500 has posted a bigger gainsince March 2009, the index's value remains almost $3 trillion lessthan at the 2007 high.

“Higher prices do affect volume, but I believe that the lowervolume is more reflective of the continuing uncertainty in themarketplace,” Steven Listor, the New York-based head of equitytrading at BNY Mellon Wealth Management, which oversees about $168billion, said in a phone interview. “I don't see the institutionalinvestor community clamoring for stock splits.”

Odd Lots

Even when investors aren't spooked by high share prices, thetrades they carry out in companies such as Google may not becounted because of rules on so-called odd lots, or trades of fewerthan 100 shares. Such transactions aren't reported in officialvolume or compiled in the Trade and Quote Database, or TAQ,maintained by the largest exchanges.

While that mattered little when odd lots accounted for less than1 percent of New York Stock Exchange volume in the 1990s, itdistorts tallies now, according to a July 2011 study by researchersat Cornell University in Ithaca, New York, and the University ofIllinois, Urbana-Champaign.

“The emergence of high-priced stocks such as Google, wheretrading a round-lot requires an investment of $50,000 or more, hasresulted in odd-lots constituting a significant fraction of tradesfor a subset of important stocks in the market,” wrote MaureenO'Hara of Cornell and Chen Yao and Mao Ye of Illinois in a papertitled “What's Not There: The Odd-Lot Bias in TAQ Data.” Round lotsare even 100-share transactions that get reported.

The number of odd-lot trades has been increasing since 2008,when the data for the study began. About 4 percent of volume in2009 went uncounted because it was done in lots of fewer than 100shares, up from 2.3 percent in 2008. The amount was 4.9 percent inthe first 11 months of 2011, according to Yao. Computerized tradingthat breaks orders up into smaller pieces is the main reason forthe increase, Ye said.

Measures such as those taken by Citigroup to fend offhigh-frequency traders and the winding down of a period whenelectronic firms were experimenting with strategies may also bedamping volume, according to Justin Schack, managing director formarket structure analysis at Rosenblatt Securities.

“From about 1997-2009, there were a lot of structural factorsthat drove volumes higher, a huge market structure transformation,”he said. “All these things inflated volumes and now all of thosedrivers have played out or reversed, the market structuretransformation is largely done.”

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