Gabelli rights offering

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1030danielle
Posts: 91
Joined: Fri Jul 15, 2016 12:25 pm
Location: Sunshine State

Gabelli rights offering

Post by 1030danielle »

Thanks to an inheritance, I have all sorts of individual stocks right now. Among them is Gabelli, GAB.
Vanguard emailed to inform me of a rights offering the company is … offering.
According to investopedia, doing nothing is not in my best interest.
Thoughts?

Link to investopedia article: https://www.investopedia.com/investing ... ts-issues/

Cheers,
Danielle
Three-funder with a tech tilt.
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JoMoney
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Joined: Tue Jul 23, 2013 5:31 am

Re: Gabelli rights offering

Post by JoMoney »

Interesting, no particular opinion on the specific offer, but this is yet another good example of the complexities and (forced) decisions that come with owning individual stocks. People talk about buying a portfolio of individual stocks and then doing nothing or 'holding forever', but there are lots of corporate events that force one into making choices, essentially trades, which I view as opportunities to make mistakes (I believe most people are at a disadvantage when transacting in the market and should avoid situations that lead to trading.)
The decision I made some time back was to divest myself of individual stocks and find a low-cost broad-market index fund to put a veil over these things and minimize the impact of any individual event.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
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retired@50
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Location: Living in the U.S.A.

Re: Gabelli rights offering

Post by retired@50 »

GAB is near a 5 year high.
Looks like a good time to sell and buy an index fund with the proceeds.

Regards,
This is one person's opinion. Nothing more.
backpacker61
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Joined: Wed May 20, 2020 6:36 am

Re: Gabelli rights offering

Post by backpacker61 »

1030danielle wrote: Thu Jun 10, 2021 8:05 am According to investopedia, doing nothing is not in my best interest.
Thoughts?
Yes, don't do nothing. Your rights offering has monetary value. Either
  • sell the rights on the open market
  • elect to exercise them (and ensure you have sufficient funds in your sweep account to cover the shares acquired's subscription price)
Letting the rights expire as worthless would be a poor choice.

I elected to exercise my GAB rights, although I went back and forth on it.
I exercised a similar rights offering on GUT a few months ago.
“Now shall I walk or shall I ride? | 'Ride,' Pleasure said; | 'Walk,' Joy replied.” | | ― W.H. Davies
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Topic Author
1030danielle
Posts: 91
Joined: Fri Jul 15, 2016 12:25 pm
Location: Sunshine State

Re: Gabelli rights offering

Post by 1030danielle »

Thank you!
Three-funder with a tech tilt.
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