Cory Diary : Exercising Rights Allocated and Access Shares Application using Nominee Account through DBST

This is my first time applying to Exercise my Rights and Excess Shares application through Nominee Account. And I want to have this blogged for future reference.

In Investopedia definition " A nominee account is a type of account in which a stockbroker holds shares belonging to clients, making buying and selling those shares easier."

After selling a chunk of my iReit Global Shares. I am left with 23,000 shares in DBST which works like a nominee account that I would like to try out the experience.

First Step

Receive a notification from DBST in the online Wealth Management Notification Icon. 

 Notification

Second Step

Is important step as any mistake may render application erroneous with unintended consequences.  I heard layout can be different between different brokers and ATMs. So do be very careful and consult your banks or brokers. For my case is as follow.

A) Enter how many shares I like to buy of the entitled shares.

For my case is 10,442. Price at 49 cent. Since the stock as that time is trading at about 71 cents, obviously I like to subscribe all of it. This will cost me only $5116.58 which they deduct later. A discount of $1253 ! as share price lowered to 61 cents.

B) Enter how many shares I like to apply for Excess.

For my case is 60,558. The 558 shares are to round it off to the entitled. It may not be necessary from what I heard but I am not sure. So to play safe I have it make whole. In total I applied 2.63 times excess of what I have. And this cost me $29,673.42.

Kiasu me applied on 2nd Oct which I realised is too early and probably risky because we never know how do market react to the rights issue. And there are rules after you have submitted so I am not going to take any risk to change. Fortunately, nothing serious as the stock price  holds up relatively well and close down around 61 cents.

In total $40,115.42 Cash needed just for the shares to be available for both deductions in my trading/wealth account else  may have problem in the application.

Excess Application

Third Step

As below debit date is15th Oct. In my case the entitled 10,442 shares are allocated to my main holding and cash deducted. Does that mean I can trade the share immediately ? Something to find out ....

Debit

Fourth Step

For my excess application, I get to know on 23rd Oct. Excess 5,558 Shares awarded at 49 cents.

Unawarded remaining cash is returned to my account on same day. What this mean is I gained a delta of 12 cents (Stock price 61 cents) per share which equates to $667. Kopi money !

Finally my total shares count at the end of the exercise is 39,000 Shares. That's 70% increase from initial 23,000 shares holding. hmm hmmm. And a total claim of $1920 from entitled and excess application.

Hope you like my sharing. And as usual DYODD. Warning again ! System application may change over time and process/format can be different between different brokers and ATMs.

Cory

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