Assuming everything else is constant,when an equity goes ex-rights its price should:

Question

Quizplus · Accepted Answer

When an equity goes ex-rights, it means that the rights associated with the shares have been separated from the shares themselves and are now trading separately. This typically results in a decrease in the price of the stock, as the shareholder is losing the option to purchase additional shares at a discounted price, and this devalues the existing shares. Therefore, the correct answer is A) decrease since the shareholder is losing an option.

Assuming Everything Else Is Constant,when an Equity Goes Ex-Rights Its