Corporate Actions

When a company announces a corporate action, it brings actual change to its securities either in terms of number of shares in the market or a change to the face value of the security. It is important for an investor to understand the different types of corporate actions and their effects so as to have a clearer picture about a company’s financial affairs and how that action will influence the company’s share price and performance. Corporate actions are agreed upon by a company’s Board of Directors and authorized by the shareholders. Dividends, stock splits, rights issues, and bonus issues are a few examples of corporate actions.

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