All dividends that would otherwise be mailed directly from the company to the stockholder are credited to the client's account or forwarded as the client directs. Corporate reports and proxy statements are forwarded to the customer. Right A certificate that evidences a shareholder's privilege to buy additional shares of new securities in proportion to the number of shares already owned. A company, when raising more funds by issuing new securities, may issue rights to its shareholders to give them the chance to buy additional shares before the general public. Because rights usually allow the stockholder to buy below the current market price, they ordinarily have a value of their own and are actively traded.
Most rights are valid for a relatively short period.
Failure to exercise or sell rights may result in monetary loss. Sweetener Subscription Warrant A certificate that gives a shareholder the right to purchase a security at a specified price within a predetermined time period or perpetually. At the issuance of the warrant, the specified price is usually higher than its current market value. Corporations issue warrants directly and they are sometimes offered along with a security as incentive to buy. Warrants are transferable and are traded on major stock exchanges.