Lucid Stock Is Bucking the Trend After Its Reverse Split. But Should Investors Risk it?

Group 1 - Lucid Group has experienced a significant decline in share price, down approximately 31% year-to-date, largely due to the announcement of a 1-for-10 reverse stock split in mid-July [1] - Following the reverse split on September 2, Lucid's shares have risen about 17%, and 28% from the low hit on September 3, which is atypical behavior for stocks post-reverse split [2][8] - Research indicates that stocks undergoing a reverse split typically see a drop in price before and after the split, but Lucid's stock defied this trend with a rise in price instead [3][4] Group 2 - After the reverse split announcement, Lucid's shares fell 36.5% until August 29, and then dropped an additional 10.8% on the first trading day post-split, followed by a further 7.6% decline over the next two days [4] - Despite the expected decline, trading volume for Lucid shares increased, and short interest rose to about 80% of outstanding shares, which usually exerts downward pressure on stock prices [6][7] - On September 10, as Lucid's stock price increased by 20% from its low, short interest decreased to approximately 12.8% of outstanding shares, stabilizing the stock price between $19 and $20 [9]