Stock Price and Volume Volatility of Mergers and Acquisitions Companies

Author: Marouane Ben Zidane

Issue: Summer Issue, 2025

Abstract

The stock market prices and volume volatility in Mergers and Acquisitions (M&A) create stock market inefficiencies, erodes regular and institutional investors' confidence in the stock market which makes it even more difficult for companies to raise capital and grow, and leads to market illiquidity which is another main catalyst of the stock market failure. The purpose of this review paper is to discuss how merger and acquisition have an impact on the stock market prices and volume volatility. Understanding the relationship between certain variables, like M&A events and the stock prices and volume volatility is what motivated this review study. Using a thematic methodology, this review study organizes information by content before analyzing, synthesizing, and interpreting the findings. The study shows that M&A public announcements can increase the price and volume volatility; therefore, M&A might have a positive correlation with the stock price movement and the volatility.