Noob questions on shares rights - OCBC

[Bluepica]

What are rights? I googled, read all the shares technical jargon but still don't understand... real noob here :p

 

1) let say, I've been allocated 100 rights share... if I take up, I pay $7.65 x 100. upon ex-rights, these 100 shares will be automatically go into my CDP as normal shares and I can trade it as normal trading price after that ?

 

2) if I don't take up, it will not convert into cash for me, right?

 

3) Excess rights... what is this?

 

Any shares guru can help a bit?

[Rollagt]

My reply :

 

1) let say, I've been allocated 100 rights share... if I take up, I pay $7.65 x 100. upon ex-rights, these 100 shares will be automatically go into my CDP as normal shares and I can trade it as normal trading price after that ?

 

Correct.

 

2) if I don't take up, it will not convert into cash for me, right?

 

Once the rights issue event is over and you have not take up, your rights entitlement will expires. NO cash is paid to you.

 

3) Excess rights... what is this?

 

After you had applied for your entitlement, you may choose to apply for additional rights shares but subject to the Issuer's discretion to allocate the excess rights to you. Do note that only record date shareholders are entitled to apply for the excess rights

 

For more info, do read up the OIS .

[Kusje]

What are rights? I googled, read all the shares technical jargon but still don't understand... real noob here :p

 

1) let say, I've been allocated 100 rights share... if I take up, I pay $7.65 x 100. upon ex-rights, these 100 shares will be automatically go into my CDP as normal shares and I can trade it as normal trading price after that ?

 

2) if I don't take up, it will not convert into cash for me, right?

 

3) Excess rights... what is this?

 

Any shares guru can help a bit?

 

1. Not upon ex-rights. Ex-rights is the date that ownership of the mothershare will no longer grant you the rights. Please check your cdp account to see if you have the rights. Once you exercise it, there should be a date that the exercised rights will start trading as normal shares.

 

2. If you don't exercise the rights, you can sell it on the market in lots of 1000 rights and 125 rights. Of course, if you only have 100, then you can't sell. If you have 125, I think the commission will be high anyway so no pt selling maybe.

 

3. Rights that other people don't want to exercise.

[Bluepica]

 

1. Not upon ex-rights. Ex-rights is the date that ownership of the mothershare will no longer grant you the rights. Please check your cdp account to see if you have the rights. Once you exercise it, there should be a date that the exercised rights will start trading as normal shares.

 

2. If you don't exercise the rights, you can sell it on the market in lots of 1000 rights and 125 rights. Of course, if you only have 100, then you can't sell. If you have 125, I think the commission will be high anyway so no pt selling maybe.

 

3. Rights that other people don't want to exercise.

1. I have just checked my CDP, the rights shares is in there... means if I don't exercise it upon ex-rights date (buy at $7.25 or sell at current $2.01), these rights will be gone, right?

 

3. Does that means I can apply for 900 excess rights @ $7.25 to top up my allocated shares to 1000 for easier transaction in the future, but the extra 900 is up to them to allocate to me in any number of shares available or either 900 or none at all?

[drivinghazard]

1. I have just checked my CDP, the rights shares is in there... means if I don't exercise it upon ex-rights date (buy at $7.25 or sell at current $2.01), these rights will be gone, right?

 

3. Does that means I can apply for 900 excess rights @ $7.25 to top up my allocated shares to 1000 for easier transaction in the future, but the extra 900 is up to them to allocate to me in any number of shares available or either 900 or none at all?

 

Just apply for excess rights, it's a bonus if you kena. If you have cash, just apply for more 1900, 2900, 5900 up to you.

 

[Kusje]

1. I have just checked my CDP, the rights shares is in there... means if I don't exercise it upon ex-rights date (buy at $7.25 or sell at current $2.01), these rights will be gone, right?

 

3. Does that means I can apply for 900 excess rights @ $7.25 to top up my allocated shares to 1000 for easier transaction in the future, but the extra 900 is up to them to allocate to me in any number of shares available or either 900 or none at all?

 

1. Yes

 

2. Yes. However, please note that 1 lot will be 100 shares in the future (can't remember when) so it is not necessary to top up to 1000 shares.

[Bluepica]

 

1. Yes

 

2. Yes. However, please note that 1 lot will be 100 shares in the future (can't remember when) so it is not necessary to top up to 1000 shares.

2. Sorry, you mean generally for all other shares counters or only for these shares bought with rights?

[Kusje]

2. Sorry, you mean generally for all other shares counters or only for these shares bought with rights?

 

2. All. Looks like it starts next Jan

 

The move to reduce board lot sizes from the current 1,000 shares to 100 shares from next January, way ahead of the scheduled implementation date for the collateral requirement, is expected to result in greater participation from retail investors and offset some of the decrease in volume from the end of contra trading. Small investors who have been priced out of blue chips because of the large outlay will find these counters more accessible.

 

http://www.todayonline.com/business/experts-laud-changes-sgx-share-trading

[Freestylers09]

if u dun ex ur rights, when XR, your mother shares dilute and cry..lol

[Rollagt]

if u dun ex ur rights, when XR, your mother shares dilute and cry..lol

 

But after the event, the size of ur pie you is actually the same as before ! Got to pay to ensure ur portion of the pie remain the same size !

[Latio2005A]

What are rights? I googled, read all the shares technical jargon but still don't understand... real noob here :p

 

1) let say, I've been allocated 100 rights share... if I take up, I pay $7.65 x 100. upon ex-rights, these 100 shares will be automatically go into my CDP as normal shares and I can trade it as normal trading price after that ? (yes)

 

2) if I don't take up, it will not convert into cash for me, right? (yes)

 

3) Excess rights... what is this? (options for you and all to buy)

 

Any shares guru can help a bit?

 

Now if there is rights issue, please please go subscribe. Ex-right price will correct downwards due to dilution of shares (at least from theoretical pt of view.

 

My humble simplified explanation:

 

100 shares at $1 in the market. (i.e. market cap = $100)

 

50 Rights issue at $0.50 (addntl value = $25)

 

Total shares (ex-rights) now = 150 shares

Total "value" ex-rights = $100 + $25 = $125

Theoretical value per share (ex-rights) = $125/150

= $0.833

 

 

If you do not subscribe, your original share value will drop from $1 to $0.833

 

(Of cos, stock mkt is siow one….cos the cost per share is lower, then more people can afford etc etc, then supply/demand thingy will set in…etc etc…these are for just classroom discussion.)

[Lala81]

Think very hard to get excess rights this time.

But still worth a try.

 

Sorry. the money from the rights still come from the original CDP linked bank account right? regardless if u use OCBC ATM or the rest?

[Kangadrool]

Sorry, another noob question:

 

Will there be two types of shares trading in the exchange after this? i.e. one OCBC normal and one OCBC rights share? Or there's no differentiation?

 

[F355]

Sorry, another noob question:

 

Will there be two types of shares trading in the exchange after this? i.e. one OCBC normal and one OCBC rights share? Or there's no differentiation?

 

 

No. Once you subscribed, the rights share is equivalent to the ordinary share. In their jargon , its called ranked parri passu .

[Kangadrool]

OK, thanks. Well noted. Going to hoot some excess rights.

 

No. Once you subscribed, the rights share is equivalent to the ordinary share. In their jargon , its called ranked parri passu .

 

[F355]

I have a question too.

 

I have OCBC shares bought by cash , CPF and SRS . Obviously I will have to pay cash for the rights allocated to my shares purchased by cash ; but I do not have sufficient investible CPF amount to pay for the righst bought using CPF ; and insufficient SRS balance to pay for the rights bought using SRS account.

 

1) Can I top up using cash for my CPF account

2)Can I inject more funds into my SRS even though I have contributed the maximum amount of $12,750 for the year 2014 ?

[Lala81]

I have a question too.

 

I have OCBC shares bought by cash , CPF and SRS . Obviously I will have to pay cash for the rights allocated to my shares purchased by cash ; but I do not have sufficient investible CPF amount to pay for the righst bought using CPF ; and insufficient SRS balance to pay for the rights bought using SRS account.

 

1) Can I top up using cash for my CPF account

2)Can I inject more funds into my SRS even though I have contributed the maximum amount of $12,750 for the year 2014 ?

 

good question. Dunno. haha.

[F355]

 

good question. Dunno. haha.

 

Nah beh I thot my queries answered when I saw the notification status . Nvr mind la , 5 for u anyway.