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TradingPlaces69: "Your final date for holding shares in RR to qualify for the RI is close of business tonight. 23/10. However, you must then hold those shares until the 27th to participate. "

This is typical of some of the muddled thinking that gets posted here. It's irresponsible to post about things you don't understand when you could be leading inexperienced investors astray.

Have you given any consideration to what would happen to the rights in your shares if you sold them between 23rd and 28th? By your logic neither you (the seller) or the buyer would be entitled to any rights. These rights have somehow evaporated? Where have they gone? What does trading "cum rights" and trading "ex rights mean"?

Goodness, why is there still so much twaddle being posted about this?

Your entitlement to the rights is based on your RR. share holding at close on 27th. END OF!

Talking about record dates and settlement times is over thinking it....and getting it wrong.

Still, it leads to a bit of volatility, and I guess that's what traders want.

I'm not trying to imply that selling your rights is going to crystalise a gain (it may or it may not, depending on where you bought RR. recently) but it does compensate you for the reduced stake you'll have in the company. It compensates you at a fair price ,commensurate with the RR. share price at the time. If you think RR. are going to rise after the rights issue is done & dusted then you may wish to take up the rights, just don't be tempted to take them up simply because of the headline 32p. The rights could be done at any price, it would make no difference to an investor taking them up in full.

If RR. end up trading at 85p ex-rights that means the nil paid rights shares will be worth 53p. Therefore for every right you take up at 32p you are saying goodnight Vienna to selling for 53p.

It's fine if you think RR. are a good investment. Please don't buy because you think the rights are cheap and only costing you 32p.

The word 'diluted' is very emotive and tends to used by those wanting to encourage you to part with your money.

If you don't take up the rights you receive money back. In the case of the RR. rights it's likely to be 60%-70% of the value of your holding. In effect you've elected to sell part of your stake in the company. It's quite possible you can find more attractive invetsment for the money. Put that way, it doesn't sound as bad as 'dilution', does it?

Yes, if you don't exercise the rights in full you'll end up holding a smaller percentage of the company than you did before. So what? Please explain why your pecentage holding the the company is such a big deal to you. I doubt many PIs know what percentage of the company they're holding anyway!

Re Tail swallowing

On or shortly after 28th you'll receive your rights allocation. These will be in the form of additional nil paid rights shares. You'll be able to sell these shares on the market, just like any other shares. Alternatively, if you prefer you can pay 32p be nil paid rights share to convert them to full paid RR. (if you do this, you forgo the cash you could have received by selling the nil paid shares).

If you want, you can sell some of your nil paid shares to fund exercising the rights in the others. this is tail swallowing. You might want to do this in an ISA, if it's already fully funded this year.

There's a simple formula you can use to work out how many shares you need to sell to fund taking up the remainder. In the case of the RR. rights it's:-

32 * Number of rights shares / RR. price ex-rights (i.e. on or after 28th)

I'm inclined to that trade too Ratty and will watch the morning of 12th Nov with interest, but this is duck & dive trading that may work, it may not. No-one knows for certain, especially with the market volatility caused by the US election, Brexit and Covid.

In a flat market with no dealing costs, no stamp duty and no spread it makes no difference to you in value buying or selling RR. before 28th or from 28th. Whether you're better or worse off is primarily down to market volatility.

Whilst there are certainly some trading angles you can play, I wouldn't recommend it if you don't understand what's going on.

It was the auction uncrossing, matching off the buy and sell orders. £5m is nothing.

It got extended today because the indicative uncrossing price at the end of the first 5 mins was about 240p. With an FS10 company the final auction gets extended if the indicative uncrossing prices exceeds the LAT by more than 3%. the LAT was 220.5p. It uncrossed after the first extension at 226.9p (which was within the 3% tolerance).

Once again Jimbob2020, to qualify for the rights you need to be holding at close on 27th. You can sell from open on 28th and still qualify.

Whether or not you decide to take up the rights is down to your investment judgement plaese please don't get taken in by the apparent rights discount. What you gain in one hand gets taken away from the other. If you do the sums you'll realise that rights are just a financial blag.

What you must understand is, if you don't take up the rights, in full or in part, you can sell them. If you deceide to take up the rights at 32p, you forgo that money.

Procedurally it would be a lot easier if the record date the day following the ex-rights date, as it is normally for dividends. This is because standard settlement is T+2 and means that those on the register at record date are also the people with the entitlement. This means there is no need for paperwork to be moved around from those who receive to those who are entitled.

However, if the rights record date was the day after the ex-rights date it would mean certificated holders would receive their provisionally allotment letters several days after the nil paid rights commenced trading, which would put them at a disadvantage to other holders. I think this is why the record date is set early.

Incidentally, dividends normally have Friday record dates. With T+2 settlement this means they trade ex from open on the Thursday (e.g. today). Some years ago settlement was on T+3, so dividends went ex on a Wednesday. If dividends are accompanied by share consolidations, these normally go ex the day after the record date (i.e. commonly on a Monday).

So there you go!

Just because you are on the share register on the rights record date does not mean you are entitled to the rights.

The record date determines where the provisional allotment letters get sent to (something nominee account holders won't receive). Just because you receive a provisional allotment letter does not mean you are entitled to the rights. If you have sold your shares before the ex-rights date the rights belong to the buyer, and you need to forward the letter to the buyer ASAP.

This is all explained on page 1 of the prospectus.

It's the same with dividends. It's the ex-date that matters, not the record date.

Yes Jnoor123. If you're a holder at close on 27th you are eligible for the 10 for 3 rights.

On or shortly after 28th you will receive the rights in the form of nil paid rights shares. These will listed on the stock market and tradable in their own right (excuse the pun). It's quite likely the ticker with be RRN. In theory they will be tradable up until 11th November, but in the final days they'll be little liquidity in them.

If you want, you can sell these RRN nil paid rights shares, in the same way as you can sell any of your shares. As it stands at the moment you should be able to sell them for about 44p per rights share. Given that you'll receive 10/3 rights shares per current RR. share it means the rights will be worth about 147p per current RR., should you decide to sell them. If you decide to take up the rights, you forego this money (which is why the total cost of taking up your rights is a lot more than simply 32p per share).

If you wish, you should also be able to buy the nil paid shares.

The reason the nil paid rights shares (ticker possibly RRN) will trade from 28th at about 32p below RR. is because it costs 32p to exercise the rights.

If you do nothing at let the rights lapse, by defauly you are deemed to have elected to sell them. They will get placed in the rump on 12th November and you will receive your share of the proceeds. This should happen even even you have a CFD position, but you may find you have to assert this quite forcefully with your CFD provider!

Your 23:12 last night is absolutely right Jnoor123. Those poeple with a 'cunning plan' to trade this opportunity between 23rd and 28th are either being naive or being mischievous. Please don't fall for it.

There really is a lot of tosh posted here!

RR. commence trading ex-rights on 28th. If you buy shares before then they are cum rights. This talk of settlement times is another silly diversion, possibly from those trying to play games. As if they can manipulate a FTSE 100 spouting this twaddle!

It is possible that they'll be a bit of a dip on 24th. Not because the shares trades are no longer trading with the rights entilement (they are) but because they'll be a few people thinking that. I can't see it being significant. Pros and anyone with a little experience knows it's the ex date that matters and any attempt at a serious dip would get bought into.

mann123, I hope someone understood that, because I haven't a clue what you're on about. Perhaps it's because I gave up trying when I read 'record date'!

RR. is a FTSE 100 company. If holders have the option to sell their rights there have to be buyers. I'd expect them to be tradable at IG, long and probably short too.

From 28th the nil paid shares will be traded, using a temporary ticker. By convention it ends in 'N' so it's probable it will be RRN.

In theory it should track 32p below RR. If you're thinking of buying RR. and RRN are 32p or more cheaper, then it will cost you less to buy RRN and take up the rights (make sure you don't leave it too late). If you're buying real shares (not CFD/spread) you'll also save stamp duty, because you don't pay stamp duty on the 32p.

I think you're right Cheeky. There are some bored trolls out there

There really needs to be a sticky post facility.

They go ex-rights from open on 28th. In order to qualify for the rights you need to be holding at close on 27th. If you sell the shares ex-rights from open on 28th you'll still qualify for the rights.

Overall though you may find it cheaper to simply buy the shares from 28th and not have the hassle of the rights.

If you're feeling a bit sophisticated you might find it cheaper to buy the nil paid shares from 28th and exercise them. As it's a fairly deep rights issue, sellers in the nil paid rights could push them to more than 32p below the RR. shares. If you're looking as it as a longer term investment, that might be the cheapest way to buy them.