CNNMoney: On Thursday morning, Facebook’s stock price fell to a new low: $19.69. Trading volume was particularly high, with 78 million shares changing hands in the first hour and a half.
Experts say the reason for the high volume and declining price is that 271 million more shares became available for trading. At the time of Facebook’s IPO, employee stock holdings were “locked up” and unavailable for trading for a set number of days. Thursday was the first day that many of those insider shares could be sold. The IPO agreement included staggered lockup periods, so today’s scenario could be repeated several more times over the next nine months.
Many Facebook employees will need to sell some of their stock in order to cover their tax bills.