REFS is
a mine of invaluable information for the private investor.
Selecting shares without its help is like trying to
clap with one hand tied behind your back.
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Scrip
or capitalisation issues
Sometimes
there are technical or practical reasons why a company may
decide to increase the share capital in issue without actually
raising any cash from shareholders. This can be achieved by
capitalising some of its surplus reserves (a scrip or bonus
issue) and increasing the number of shares in issue. The new
shares created are then issued to existing shareholders on
a pro-rata basis. Any previous per share values are adjusted
by applying a correcting or compensating factor.
Calculation of adjustment factors
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