Bonus and rights issues of shares
GoldenRetreiver
Registered Posts: 64 Regular contributor ⭐
Hi when you have a bonus issue of shares - you dont index up to the date of the new issue because there is no money involved. However, I am unsure what to do with rights issues - do I index up to the date of the rights issue or not?
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GoldenRetreiver wrote: »Hi when you have a bonus issue of shares - you dont index up to the date of the new issue because there is no money involved. However, I am unsure what to do with rights issues - do I index up to the date of the rights issue or not?0
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After retrieving my text books and looking this one up I can say I've made a complete fool of myself I was getting confused with the bonus shares - these have to be attached to the original purchase (especially if the issue is after 1998, else your pool will be incorrect). However contrary to my first attempt at this post, in the event of a rights issue shares held would be indexed to the date of issue and the pool would be continued in the usual way. Apologies if anyone read my original post and was a little confused!0
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you would only index the cost of the original 5000 as the rights issue is already valued at that present day.
One note to remember if you have two asset pools open one for before april 1998 and one for after 1998 and you get a rights issue, remember to include in both!!0
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