Arbitrage opportunities and event impacts on Spanish rights issues

In equity offerings in which pre-emptive subscription rights are issued, there two ways of acquiring the company’s shares: either by buying them directly on market, or subscribing to new shares using rights. This could lead existence arbitrage opportunities. addition, announcement these processes incorporates very relevant information generate abnormal returns for shares. paper analyses both hypotheses simultaneously same sample and concludes that indeed opportunities also can be detected. Furthermore, it is concluded effects especially significant companies with low liquidity short positions market not available.