Right

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Right

Privilege granted shareholders of a corporation to subscribe to shares of a new issue of common stock before it is offered to the public. Such a right, which normally has a life of two to four weeks, is freely transferable and entitles the holder to buy the new common stock below the public offering price. See: Warrant.

Rights Offering

In stock, the ability of a shareholder to maintain the same percentage of ownership in a company should the company issue more stock by buying a proportional number of shares at or below the market price. This protects the investor from devaluation of his/her shares if the company decides to hold a round of financing. The purchase of this proportional number of shares usually takes place before the new issue is offered to the secondary market, and must be exercised before a certain date (known as the expiration date) if the shareholder is to maintain the same percentage of ownership. Rights offerings or issues are also called subscription rights or simply rights. See also: Anti-dilution provision.

right

A certificate that permits the owner to purchase a certain number of shares, or, frequently, a fractional share of new stock from the issuer at a specific price. Rights are issued to existing stockholders in proportion to the number of shares the stockholders already own. Rights then may be combined with cash to purchase the new shares or they may be sold to other investors. Rights usually have value because they permit the owner to purchase shares of stock at less than the market price. A right is indicated in stock transaction tables by the symbol rt, appearing after the stock's name. Also called stock right, subscription right. See also ex-rights, preemptive right.
Should rights be sold or used?

Rights offerings refer to the right of an investor to maintain his or her percentage ownership in a company when the company decides to issue new stock. Generally the company will do so at a discount to its market price to attract buyers, thus the existing stockholders' rights have value. The decision a rights holder must make is whether to put more money into the stock of this company or to sell the rights in the open market as compensation for the dilution of his or her percentage ownership in the company. TIP: Such a purchase depends completely on the individual's circumstances, goals, prejudices, and objectives—just as in any other stock purchase—and should be approached accordingly.

Thomas J. McAllister, CFP, McAllister Financial Planning, Carmel, IN

Right

The opportunity a corporation gives a shareholder to buy additional shares at a special price for a limited time. Shareholders who don't use their rights can sell them to other investors.
References in classic literature ?
Not right off, of course, for the native of those islands does not, as a rule, dissolve upon the early applications of a humorous thing; but the fifth time I told it, they began to crack in places; the eight time I told it, they began to crumble; at the twelfth repetition they fell apart in chunks; and at the fifteenth they disintegrated, and I got a broom and swept them up.
When he heard the noise of the men bustling about, he jumped up on a sudden and forgot all about coming down by the main staircase, so he tumbled right off the roof and broke his neck, and his soul went down to the house of Hades.
McNear's is right off there," Charley said, pointing directly into the fog on our weather beam.
Here's the pony run right off his legs, and me obliged to come home with a hack cob, that'll cost fifteen shillings besides other expenses,' said Squeers; 'who's to pay for that, do you hear?
Just like Jim Hazard, comes along and makes himself at home, you're as good as he is an' he's as good as you, an' we're all friends together, just like that, right off the bat.
And thou mayest as well sign the papers right off, he added -- come along with ye.
If we upset his nerves enough, he will go right off his stroke.
she hears right off when she comes home, whether it's HIGGINS.
It was said he could pull a grown man's head right off.
Yesterday, when I told him I must go at something right off, he said, 'Anything honest, Tom, and don't forget that your father began the world as a shop-boy.
After another round the Slogger too seems to see that he can't go in and win right off, and has met his match or thereabouts.