Inputs
FAQs
1) What does TERP represent?
It is the theoretical share price immediately after the rights become effective, assuming the offer is fully subscribed and markets price only the dilution effect.
2) How is the value of one right determined?
It equals the price drop per existing share from dilution. Algebraically it is a(M − S)/(a + b), which is also (TERP − S)/R and M − TERP.
3) Why do I see fractional entitlements?
The exact entitlement is shown for transparency. Many brokers round down to whole shares; check your broker for treatment of fractions.
4) What if the subscription price is above the market price?
The value of a right may be zero or negative. In practice, such offers are uncommon; the market may price other factors beyond pure dilution.
5) Does this account for taxes and fees?
No. The calculator focuses on theoretical pricing. Always include brokerage fees, taxes, and your personal circumstances before making decisions.