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They issue new shares. Let's say each shareholder has 100 shares, they might issue 10,000 new shares to sell which means your shareholding gets massively dilute
by Devilboy 18y ago
They issue new shares. Let's say each shareholder has 100 shares, they might issue 10,000 new shares to sell which means your shareholding gets massively diluted unless you buy a large portion of the new shares.
- ars 18y agoWho issues shares? Isn't the company owned by the people who have shares? So aren't those people the ones issuing shares?
- kragen 18y agoThe company issues shares, but it is a separate entity from its stockholders. The money acquired by selling the shares goes to the company, not the existing stockholders. It results in the company being more valuable, and the existing stockholders (or the board of directors on their behalf) can think this is a worthwhile thing to do if they think the money will be invested well by the company.