Right

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Related to rightfully: uprightness

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 periodicals archive ?
President Napolitano said international law must be respected and that Macedonia is rightfully preserving its position regarding the principles that need to be observed fully by any country," Ivanov added.
It could be rightfully said that Moscow got the writer out of him.
But Vincent and cousin Michael Hickey - awarded pounds 900,000 - are determined to win back the money which they say is rightfully theirs and have now taken their case to the European Court of Human Rights.
THOUSANDS of pensioners could be missing out on cash which is rightfully theirs.
According to the Sun Journal, Zorb New England co-manager Jeremy Coito also acknowledged that his business is not associated with New Zealand-based Zorb Ltd., but maintained that "Zorbing is a generic trademark, a sport" and that he can rightfully use its name.
Millions are missing out on benefits, cash that's rightfully theirs, because they don't know that they are entitled to, are worried about the complexity of the process or are embarrassed about claiming.
All we want is what is rightfully ours - the pensions you told us were guaranteed, safe and protected by law.
Married Canham, 58, saved it from income support he rightfully claimed.
Its leader, Randy Brinson, contends that Giles absconded with assets and a mailing list that rightfully belongs to the Christian Coalition.
The clubs just need a share of what is rightfully theirs.
Everything, including the pressing work of their farm, is set aside so that they can rightfully contemplate and consider the wonder of Christ's Incarnation.
She rightfully points out, however, that this never amounted to a radical challenge to gender roles: girls accepted the dominant "societal messages about femininity, heterosexuality, consumerism, and commercial beauty." [174]