← Options Glossary A type of corporate action in which a company offers shares to existing shareholders. Technically a rights issue is a type of dividend, but in this case it isn’t a payment, but rather a subscription right. Existing shareholders are given the right to purchase shares before they are offered to the public. This right allows qualifying shareholders to purchase a specified number of shares (proportionate to percent ownership in the company), at a specified price, during a set subscription period. Companies executing spinoffs often utilize rights issues.
Rights Issue
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