The L1 Global Long-Short Fund (GLS.AX) announced a 1 for 2 entitlement offer (known as a rights issue in the UK). You can buy one new share for every two you have for $1.76 a share. The current share price is $1.84, but they have traded as high as $2.17 in the recent past. You might think that issuing that many new shares will crash the share price. My recent experience is that isn't the case for funds like this, so it is likely to be possible to sell for a profit.
I have 170,000 shares and am taking up the full 85,000 new shares. I am planning to hold onto 30,000 of them and to sell the rest. I am buying from my Commonwealth Bank offset account rather than trying to buy on my margin loan, which is a hassle. As the issuer has my CHESS HIN (Australian Stock Exchange ID) the shares will appear in my margin account. The highest you can raise your BPAY (an Australian payment system) limit to online is $100k. Until recently, $20k was the maximum you could raise it to yourself. So, I had to phone the bank and ask to raise it for the $149,600 payment. They then subject you to a bunch of questions about scams... They actually had to raise it to $2 million, as that is the next limit. I have now sent the money to L1 and then lowered the limit back to $20k. You don't need to submit a form, just pay via BPAY with the correct individual reference number. It's very convenient.
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