Stock Rights Issue

Loading the player...

Rights are offers that allow existing stockholders to buy additional shares at a predetermined price, for a set time period. Shareholders do not have to exercise these rights. They could let them expire. Alternatively, they could be traded in the open market
 
Why do companies offer rights? Sometimes tapping existing shareholders may be the best way to raise additional capital if they have difficulty attracting outside investors. For this reason, heavily indebted businesses will sometimes use a rights issue to pay down their obligations.
 

comments powered by Disqus
Related Articles
  1. 7 Ways To Save Money On Business Travel
    Savings

    7 Ways To Save Money On Business Travel

  2. 3 ETF Signals You May Use For Confirmation
    Economics

    3 ETF Signals You May Use For Confirmation

  3. Are All ETF Correlations Barreling Towards 1.0?
    Mutual Funds & ETFs

    Are All ETF Correlations Barreling Towards 1.0?

  4. Weekly Trading Forecast: FX Traders Prepare for Heavy Volatility on FOMC, GDP and ...
    Forex News

    Weekly Trading Forecast: FX Traders Prepare for Heavy Volatility on FOMC, GDP and ...

  5. Dollar and Market Confidence Ride on FOMC Decision
    Forex News

    Dollar and Market Confidence Ride on FOMC Decision

  6. Gold Losses to Accelerate on Less Dovish FOMC- Support Break Eyes 1206
    Forex News

    Gold Losses to Accelerate on Less Dovish FOMC- Support Break Eyes 1206

  7. AUD Faces A Potential “Breakout” On US Heavy Event Risk
    Forex News

    AUD Faces A Potential “Breakout” On US Heavy Event Risk

Trading Center