The date by which a shareholder must own shares in order to be entitled to a dividend. Redemption Charge A commission charged by some mutual funds when redeeming shares. The chargemay decrease or be eliminated as shares are held for longer time periods. Equity An indication of profitability, determined by dividing annualized net income bycommon stockholders' equity. Reverse Stock Split A proportionate decrease in the number of shares, but not the aggregate value of shares of stockheld by shareholders.
Shareholders maintain the same percentage of equity as before thesplit.
A firm may institutes a reverse split to boost its stock's market price in order to meet the listing requirements of the exchanges. Shareholders who do not exercise these rights are usually diluted by the offering. Rights may be transferrable, allowing holders to sell them on the open market to others who then exercise them.