Meta Platforms follows a number of high-profile companies that changed their ticker symbols.
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formerly known as
is taking the final step to decisively shed its previous identity on Thursday.
The company will begin trading under ticker symbol “META,” leaving behind its current trading symbol of “FB,” which has been in use since the company’s initial public offering in 2012.
There’s a few reasons companies change their ticker symbols, including merger and acquisition activity, delistings, and name changes. Meta, for instance, said the new ticker aligned with the company’s rebranding from Facebook to Meta, announced last October.
For many executives, a ticker and name change can be a way to enhance the appeal of a stock. Indeed, studies have found that people are more likely to purchase stocks with easily pronounced and memorable ticker symbols.
While the ticker change won’t mean much for people currently holding the stock—who will automatically see the update on their trading platforms—history suggests that changing a ticker could create confusion in the immediate aftermath.
In a 2006 study of 171 ticker changes, researchers found that there was a “significant reduction in trading volume” and a decline in stock prices on the day a pure ticker change went into effect, as well as on the following day. The drops weren’t reversed in the subsequent five days, with some persisting over a decade, the University of Texas at San Antonio researchers found. They attributed…