Shares of the psychedelic medicine company Mind Medicine (MindMed) (NASDAQ: MNMD) tumbled by a heftly 23% through the first three and half days of trading this week, according to data from S&P Global Market Intelligence. The good news is that the novel healthcare company's stock didn't lose ground in response to a negative clinical catalyst or regulatory development.

Instead, shareholders simply appear to be reacting to MindMed's recent 1-for-15 reverse stock split, which took effect on Aug. 29. The company enacted this reverse stock split in order to maintain compliance with Nasdaq's $1 minimum bid requirement.

Over the prior 12 months, MindMed's shares had lost 71% of their value, putting its stock at risk of being delisted by the Nasdaq exchange. Mr. Market slashed the company's valuation over this period in response to rising interest rates, geopolitical unrest, and a growing aversion to risk by investors in general.

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Source Fool.com