<p>I owned 1382 shares of a company.
This year they gave me 138 bonus shares(for free), which made the total 1520.</p>
<p>Then a right share offering in which the company offered me 989 shares for the IPO price.</p>
<p>Now my total is 2509.</p>
<p>Is my value decreasing because of the right share issue?</p>
<p>I was once offered shares in a rights issue. You have the choice to keep the shares (exercise them - buy the shares - at a certain point) or sell them because they are tradeable like shares are. If you exercise them, you maintain proportional ownership in the company. You should have been offered to buy the shares at a discount to current share price, so if you believe in the stock/company, it may be worthwhile holding onto them and exercising the rights.
Hope that helps</p>
<p>I guess that was what I was asking. I don’t know anything about this stuff.</p>
<p>And exactly, if before the right issue I owned x/y of the company, afterwards I still own x/y right?</p>
<p>But when does the proportion I own of the company decrease? Under what circumstances?</p>
<p>I believe that if you keep the rights and exercise them (convert them into shares) then you will own the same x/y proportion. If you sell them, you will own less of the company, but obviously have some money in hand. I believe this is the way it works but perhaps call your broker, they should be able to explain it to you.</p>
<p>~ TM</p>