Broad-Based Weighted Average


DEFINITION of 'Broad-Based Weighted Average'

An anti-dilution provision used for the benefit of existing preferred shareholders when additional offerings are made by the corporation. The broad-based weighted average accounts for all equity previously issued and currently undergoing issue.

BREAKING DOWN 'Broad-Based Weighted Average'

The new weighted average price is adjusted for the preferred shareholder providing for protection against dilution. However, because all equity issued by the company is included in the weighting process, it is not as favorable as other weighting methods.

  1. Dilution

    A reduction in the ownership percentage of a share of stock caused ...
  2. Narrow-Based Weighted Average

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  3. Full Ratchet

    An anti-dilution provision that, for any shares of common stock ...
  4. Anti-Dilution Provision

    A provision in an option or a convertible security. It protects ...
  5. Security

    A financial instrument that represents an ownership position ...
  6. Return On Invested Capital - ROIC

    A calculation used to assess a company's efficiency at allocating ...
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