(6) Subscribing For Excess Rights Shares Beyond Entitlement
It is one of the most unbeatable methods to beat a company’s rights issue. Every rights issue is not attractive enough for subscription purpose. But, some rights issue does carry the possibility of greater success in short to medium term scenario.
Rights issue is likely to bring greater returns for investors if the underlying company is fundamentally strong, future outlook is promising, issue is priced attractively for investors, market sentiments are extremely bullish, & many more.
In such an overall bullish scenario, shareholders should always consider subscribing for excess rights shares over & above their entitlement. This strategy works best for those who can afford to invest more in an underlying company for better returns.
However, the final decision for excess share allotment in rights issue will be taken by management of the underlying company.
Image Source: Shutterstock
- Best Trading Strategies To Make Money In Rights Issue: Shutterstock