Comments on: India Fund Inc. rights offer and Scottrade http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/ Introduction to Investment, Credit and Personal Finance for Us Regular Joes Mon, 01 Dec 2008 16:37:39 +0000 http://wordpress.org/?v=2.6.1 By: Jeff http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-24 Jeff Tue, 22 Aug 2006 17:29:04 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-24 Well, if you look back at the date the shares were handed out, you'll notice a lot of volume and a large price drop (Aug 9th, I think). Basically, everyone got their shares around 2:00PM and tried to sell right away. This increased supply lowered the share price to within 5% of the NAV (Net Asset Value = the real value of the shares in the fund). The premium to the NAV used to be almost 30% and this offering narrowed that significantly. Thus, the shares you had originally dropped, but the shares gained through the offering were worth about 10% more than what you paid. Conveniently, the NAV continued to rise and the stock has also within the 5% premium. We'll see how long this lower premium lasts. I have hopes that the stock will continue higher. Monday morning quarterbacking this: the best thing to have done was to sell the shares you already owned the day the offer was made, but use the rights you have to buy more shares that you then contnue to hold for the long term. I'm dumb and only did half of this. Well, if you look back at the date the shares were handed out, you’ll notice a lot of volume and a large price drop (Aug 9th, I think). Basically, everyone got their shares around 2:00PM and tried to sell right away. This increased supply lowered the share price to within 5% of the NAV (Net Asset Value = the real value of the shares in the fund). The premium to the NAV used to be almost 30% and this offering narrowed that significantly. Thus, the shares you had originally dropped, but the shares gained through the offering were worth about 10% more than what you paid.

Conveniently, the NAV continued to rise and the stock has also within the 5% premium. We’ll see how long this lower premium lasts. I have hopes that the stock will continue higher.

Monday morning quarterbacking this: the best thing to have done was to sell the shares you already owned the day the offer was made, but use the rights you have to buy more shares that you then contnue to hold for the long term. I’m dumb and only did half of this.

]]> By: Sidd http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-17 Sidd Wed, 02 Aug 2006 14:05:08 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-17 Actually, the money collected in the rights offering is used to issue completely new shares. So there is no dilultion. However the shares are issued at a discount of 5% to NAV, so the Fund takes a loss of 5% on the newly issued shares. I'm not exactly sure how this affects the Fund but I would guess it is nothing major. Actually, the money collected in the rights offering is used to issue completely new shares. So there is no dilultion. However the shares are issued at a discount of 5% to NAV, so the Fund takes a loss of 5% on the newly issued shares. I’m not exactly sure how this affects the Fund but I would guess it is nothing major.

]]> By: Ricky http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-16 Ricky Wed, 02 Aug 2006 13:58:21 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-16 So I'm relatively new to investing and I was just sort of curious the affect a rights offerring as such would do to the market price of IFN once the rights offering is complete. I figure it would dramatically dilute the market value of the stock. So I’m relatively new to investing and I was just sort of curious the affect a rights offerring as such would do to the market price of IFN once the rights offering is complete. I figure it would dramatically dilute the market value of the stock.

]]> By: Sidd http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-15 Sidd Tue, 01 Aug 2006 13:10:21 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-15 Correct, you are not entitled to the offering. Correct, you are not entitled to the offering.

]]> By: ASharma http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-14 ASharma Mon, 31 Jul 2006 21:58:06 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-14 Friends, The notice says that you have to be an owner as of July 3- does that mean if I buy 100 stocks on July 31st/Aug 1- I am not entitled to this offering? -Sharma Friends,
The notice says that you have to be an owner as of July 3- does that mean if I buy 100 stocks on July 31st/Aug 1- I am not entitled to this offering?

-Sharma

]]> By: Sidd http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-8 Sidd Thu, 13 Jul 2006 14:23:48 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-8 Hi Jeff, Last Year I owned a lot more shares of IFN than I do now and I did make a nice gain from the Rights offer. I am considering oversubscribing this year. Siddharth Hi Jeff,

Last Year I owned a lot more shares of IFN than I do now and I did make a nice gain from the Rights offer. I am considering oversubscribing this year.

Siddharth

]]> By: Jeff http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-7 Jeff Thu, 13 Jul 2006 13:58:02 +0000 http://www.parchayi.com/2006/07/10/india-fund-inc-rights-offer-and-scottrade/#comment-7 Hi: I just invested in IFN recently and received these rights as well. It seems like it is an easy 30% gain to excersise the rights at 95% of NAV. It also sounds like IFN extended these rights last year as well and you took advantage of it. How did it go? Did you make a nice gain off of it? Regards, Jeff Hi:

I just invested in IFN recently and received these rights as well. It seems like it is an easy 30% gain to excersise the rights at 95% of NAV. It also sounds like IFN extended these rights last year as well and you took advantage of it. How did it go? Did you make a nice gain off of it?

Regards,
Jeff

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