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The Rate Of Return Under Re-Capitalization: A Note, Mohamed Ariff, Kian Guan Lim
The Rate Of Return Under Re-Capitalization: A Note, Mohamed Ariff, Kian Guan Lim
Research Collection Lee Kong Chian School Of Business
The article discusses issues related to variations in rate of return of stocks under re-capitalization. Share returns are commonly adjusted for re-capitalization by distributing the difference between market and exercise prices over the number of shares. Re-capitalization is said to occur when the total amount of equity capital or number of shares in a firm changes. New issues usually take the form of bonus issues or new paid-up issues called rights issues, which do not change the amount of equity.