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Ep43 Examining Bad Investment Advice

All Else Equal: Making Better Decisions

CHAPTER

The Misconception of Stock Dilution and Value Impact

This chapter dives into the concept of stock dilution, debunking misconceptions around its impact on share value and company worth. It explores scenarios of share dilution based on shareholder actions and competitive pricing, emphasizing the need for a nuanced understanding of how new shares enter the market. The discussion also delves into the necessity of stock issuance for sustaining a business's growth or performance, shedding light on the role of dilution in company success.

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