TERP, theoretical rights value, entitlement, subscription cash and cashless take-up.
A free Alpha Investors tool
Rights Issue Calculator
Calculate your entitlement, subscription cash, theoretical ex-rights price, rights value and cashless take-up sizing.
Open access · no email required · no sign-up
Your holding, subscription price, issue ratio and the relevant share price.
Whether you should subscribe, sell the rights or change the investment case.
01
Change any fieldOffer terms
02
Theoretical outputYour calculation
- Entitlement
- 72.73
- Cash to subscribe
- EUR 98.18
- TERP
- 2.4355
- Value detached per old share
- EUR 0.7895
- Nil-paid value per new share
- EUR 1.0855
- Ex-rights price used
- EUR 2.4355
- Sell shares for cashless take-up
- 41
- Sell nil-paid rights for cashless take-up
- 41
- Final shares: sell shares, then subscribe
- 131.73
- Final shares: sell rights, then subscribe
- 131.73
Theoretical only. Keep every price in the same currency unit. Entitlement fractions, renounceability and rounding are offer-specific. The cashless-rights figure uses the entered market-right price when supplied; otherwise it uses theoretical parity. Excludes taxes, dealing costs and processing constraints.
The decision after the calculation
The maths is mechanical. The portfolio decision isn't.
Your entitlement is 72.73 and the theoretical cash required is EUR 98.18. That still does not tell you whether the issue improves the investment case, deserves more capital or fits the rest of your portfolio.
Has the thesis changed?Does the new risk deserve capital?What else does the position displace?
Optional parity monitor
Compare the quoted right with share parity.
Add a rights price and estimated friction to test whether the quoted right and ex-rights share are close to theoretical parity.
- Fair quoted right from share parity
- EUR 1.0855
- Fair ex share from rights parity
- —
- Signed spread: share − right package
- —
- Estimated friction
- —
- Net spread
- —
Implied ex-rights priceEUR 2.4355
Implied cum-rights price—
Optional live quotes using your Alpha Vantage key
The key stays in this browser. Alpha Investors does not receive it. Quotes may be delayed and rights symbols vary by exchange.
How it works
Offer terms in. Mechanical outputs out.
- Enter your current holding, subscription price and issue ratio.
- Choose whether the share price is cum-rights or ex-rights, then enter it.
- Select whether the quoted right is one nil-paid new share or one right issued per old share.
- Add an optional market-right price, then read the entitlement, cash, TERP, parity and tail-swallow outputs.
Rights issue mechanics
Understand what the calculation is—and what it is not.
A correct calculation is a useful input. It is not an investment recommendation or a forecast of the post-issue share price.
What is a rights issue?
A rights issue lets existing shareholders buy new shares, usually below the current market price. The offer ratio determines how many new shares can be bought for each old share held.
What is TERP?
The theoretical ex-rights price blends the cum-rights share price with the discounted subscription price and issue ratio. It is a mechanical reference point, not a price target.
How is rights value calculated?
A nil-paid entitlement that subscribes for one new share is worth the positive gap between the ex-rights price and subscription price. The value detached from each old share is that amount multiplied by the new-for-old ratio. Some exchanges quote one right per old share, so the calculator lets you select the traded unit explicitly.
What is tail-swallowing?
Tail-swallowing, or cashless take-up, means selling enough shares or rights to fund the subscription cash needed to take up the remaining entitlement.
What the calculator includes
- Entitlement and subscription cash.
- TERP and theoretical rights value.
- Indicative shares or rights to sell for cashless take-up.
- Optional share-rights parity and friction estimates.
What it deliberately excludes
- Taxes, dealing costs and broker-specific rounding.
- Whether the company's investment case has improved or deteriorated.
- Whether adding capital fits your risk budget and wider portfolio.
- Personalised investment advice.
Common mistakes
- Treating TERP as a forecast rather than a theoretical reference.
- Ignoring how the new capital changes leverage, dilution and the thesis.
- Calculating the position in isolation from portfolio concentration.
- Assuming market rights must trade exactly at parity.
When the decision matters most
The difficult question is rarely the formula. It is whether the financing repairs the balance sheet, funds attractive growth, transfers value or simply asks shareholders to underwrite a weakened thesis.
Formula basis. TERP uses the weighted old-share value plus gross subscription cash over the enlarged share count. Cashless take-up sells the minimum whole quoted-right units needed to fund the remaining subscription at the selected unit convention. See the official HMRC TERP method and the Bank of England share-issuing guide.
From isolated calculation to repeatable process
The number is an input. The decision is the work.
See how Alpha combines market context, company research, sizing, portfolio fit and review—then decide whether the community or Alpha OS fits how you invest.