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Re: [Czechlist] THANKS: diluted shares

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  • Martin Janda
    Thanks to Tomas and Jamie for help. As I still don t know any decent Czech name for basic and diluted shares, I went for the easiest solution - zakladni and
    Message 1 of 1 , Apr 30, 2003
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      Thanks to Tomas and Jamie for help. As I still don't know any decent Czech
      name for basic and diluted shares, I went for the easiest solution -
      zakladni and zredene and left the rest upon the client.

      M.



      ----- Original Message -----
      From: <JPKIRCHNER@...>
      To: <Czechlist@yahoogroups.com>
      Sent: Wednesday, April 30, 2003 3:34 PM
      Subject: Re: [Czechlist] TERM: diluted shares


      >
      > In a message dated 4/30/03 9:01:28 AM, mjanda@... writes:
      >
      >
      > > Yes, Jamie, that's what I understand. Diluted s.= all shares issued. But
      are
      > > basic shares the same as common shares ???
      > >
      > > Probably they are not, as google returns multiple hits of "Basic common
      > > shares"
      > >
      > There's a great dictionary online that I've just found:
      >
      > http://www.small-business-dictionary.org/
      >
      > I think you can find something out from their definition of diluted
      earnings:
      >
      > "DILUTED EARNINGS
      > A situation whereby additional shares of stock were sold to other
      investors
      > causing the earnings to be spread over a broader base. Thus fewer earnings
      > are available for each share unless earnings grow proportionately more
      than
      > the number of new shares issued."
      >
      > And here is something from the Oxford Dictionary of Finance:
      >
      > "DILUTION OF EQUITY
      > An increase in the number of ordinary shares in a company without a
      > corresponding increase in its assets or profitability. The result is a
      fall
      > in the value of the shares as a result of this dilution."
      >
      > My understanding is that "diluted shares" are what you've got when a
      company
      > has issued additional shares without, as the dictionary says, increasing
      its
      > assets or profitability. Let's say a company had a million shares
      > outstanding, and you owned 100, on which you got a dividend of 0.06.
      Then
      > the company issues another million shares, and they spread the dividend
      over
      > the new total of 2 million shares. Your shares have been diluted
      (remember
      > that diluted literally means "watered down"), and now you're only getting
      a
      > dividend of 0.03. This decrease in dividend yield will wind up lowering
      the
      > value of your shares.
      >
      > Jamie
      >
      >
      > [Non-text portions of this message have been removed]
      >
      >
      >
      > Czechlist archive: http://groups.yahoo.com/group/Czechlist
      >
      > Czechlist resources:
      > http://www.geocities.com/Athens/Forum/7953/Intro.html
      >
      > Post message: Czechlist@yahoogroups.com
      >
      > Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
      >
      >
      >
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