Equity risk and Rights issue: Difference between pages

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imported>Doug Williamson
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imported>Doug Williamson
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1.
A process of issuing new equity shares where they are offered first to existing shareholders in proportion to their existing shareholding.  


The variability of returns to equity investors, often measured by the standard deviation of equity returns.  
Existing shareholders have, under law in the UK, pre-emption rights.


In the Capital asset pricing model, total equity risk is driven both by:
This means that they generally have first refusal on the purchase of any new equity shares.
:(i) the underlying business risk and
:(ii) the additional financial risk resulting from the level of debt in the firm’s financial structure.
 
 
2.
 
The risk of losses on direct equity investments (shareholdings) or on other equity-linked positions.




== See also ==
== See also ==
* [[Beta]]
* [[Bonus issue]]
* [[Business risk]]
* [[Dividend irrelevancy theory]]
* [[Capital asset pricing model]]
* [[Headroom]]
* [[Equity]]
* [[Initial public offering]]
* [[Equity beta]]
* [[Nil paid]]
* [[General equity risk]]
* [[Option premium]]
* [[Financial risk]]
*[[Placing]]
* [[MRBB]]
* [[Pre-emption rights]]
* [[Specific equity risk]]
* [[Theoretical ex-rights price]]
* [[Trombone]]


[[Category:Manage_risks]]
[[Category:Accounting,_tax_and_regulation]]
[[Category:The_business_context]]
[[Category:Corporate_finance]]
[[Category:Investment]]
[[Category:Long_term_funding]]
[[Category:Financial_products_and_markets]]

Revision as of 06:53, 23 August 2019

A process of issuing new equity shares where they are offered first to existing shareholders in proportion to their existing shareholding.

Existing shareholders have, under law in the UK, pre-emption rights.

This means that they generally have first refusal on the purchase of any new equity shares.


See also