[rich_sasha]

There are weird incentives for this.

In US the tick size for any stock is always $0.01. So a stock with a price of say $1 has a minimum bid ask spread of 1%, which is a lot.

On the contrary, if one share is too expensive, it limits liquidity in a stock. This is usually bad, though Berkshire Hathaway voting shares are deliberately kept expensive to stave off speculators.

This then get meta-player. A split suggests the company expects a price increase, and vice versa (reverse splits area thing too).

[esrauch]

It seems very strange; can a share not be worth less than 1 cent, or can it for ask but not bid?

[cynix]

It can be "worth" less than 1 cent. That simply means if you put in an offer at 1 cent, nobody will buy it, because they think it's worth less.

[esrauch]

I meant if the bid-ask spread must be minimum 1 cent, then is it true that bid can't be lower than 1 cent as long as ask is semipositive?