On the record date, the price adjusts for dilution due to additional rights issues (Is it due to automatic measures similar to splits or market pressures foreseeing the dilution due to rights issue listing?).
If we got the original shares only for playing the rights issue special situation, it is probably best to sell on the record date, simply for the reason that we don’t have any further rationale behind holding them. In such a case, holding is purely speculation.
If we think that the stock we hold is cheap and of decent quality, and we can hold for a year or so, we arrived at a reason to hold.
That’s just my understanding. Would love to know the answer from experienced investors in this regard.
| Subscribe To Our Free Newsletter |
