The two-for-one stock split that PPG Industries’ shares will undergo in mid-June gives it good odds of beating the market over the next three years.

Sound too easy — too good to be true?

Take the performance of an investment newsletter titled, simply, “2-for-1.” Each month, Editor Neil MacNeale picks a stock that has recently split its shares, and he holds it in his service’s model portfolio for exactly 2½ years. Since October 2000, when the Hulbert Financial Digest began monitoring this service’s performance, it has doubled the Wilshire 5000 index’s annualized return, 10.5% to 5.3% — making it one of the best performing advisers over this period among those monitored.

This 15-year market-beating return is probably long enough to convince you that this stock-split effect is not a fluke. But, for the record, it’s backed up by solid academic research as well.

One of the first such studies was conducted by David Ikenberry, dean of University of Colorado’s Leeds School of Business. He and two co-researchers found that the average stock that underwent a stock split between 1975 and 1990 outperformed the market by 7.9% over the year following the split’s announcement, and by 12.2% over the three years following that announcement (equivalent to 3.9% per year on an annualized basis).

Because MacNeale’s performance over an entirely different 15-year period is quite similar to what Ikenberry reported, it provides an out-of-sample confirmation of the stock-split effect — increasing our confidence that the effect is genuine. This furthermore suggests that the phenomenon is not easily discounted away, despite widespread knowledge of its existence.

You might wonder why something that otherwise appears to be nothing but an accounting entry can have such bullish consequences. Ikenberry believes it’s because there is a “sweet spot” in which the typical company likes to have its stock trade. Though that sweet spot is not precisely defined, companies will not split their shares, even if the prices of those shares have risen sharply, if management believes there is a significant probability that their prices will fall back by themselves.

In effect, therefore, stock splits are a signal from management that they have confidence in the continued appreciation of their companies’ shares.

To be sure, this stock-split effect doesn’t work every time. So don’t place all-or-nothing bets on any one stock undergoing a split. MacNeale’s model portfolio, for example, is always diversified among 30 stocks — one each for the 30 months that he holds a given stock.

The other stocks that MacNeale has added to his model portfolio so far this year, besides PPG Industries PPG, -2.69% , are:

• Starbucks SBUX, -2.07%

• Magna International MGA, -2.43%

• New Jersey Resources NJR, -2.50%

• Gentex GNTX, -0.94%

And, yes, MacNeale holds Apple AAPL, -3.17% in his model portfolio too. He added it in April of last year, following the company’s announcement of a seven-to-one split, and intends to hold it until late 2016.

So far, at least, the stock has been a big winner for him: It has gained 63% since the date of that announcement, versus 13% for the S&P 500.

Click here to inquire about subscriptions to the Hulbert Sentiment Indexes.