When shares are purchased cum-rights it means the purchaser of the share:

Question

Quizplus · Accepted Answer

When shares are purchased cum-rights, it means the purchaser is entitled to participate in the rights offer, which allows them to buy additional shares at a discounted price. This is in contrast to ex-rights, where the purchaser does not have the right to participate in the rights offer. Option A is incorrect because a purchaser can sell the right separately in some cases. Option C is incorrect because as mentioned, a purchaser of cum-rights can take part in the rights offer. Option D is incorrect because taking up the right offer may require paying the subscription price.

When Shares Are Purchased Cum-Rights It Means the Purchaser of the Share