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A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh
We study a model of the firm, with perpetual debt and a continuously payable coupon as well as the possibility to raise cash via equity issuance. Excess cash is paid back to shareholders either via dividends or via buybacks. The number of shares changes when equity is issued and when the firm buys b...
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| Format: | Thesis |
| Language: | English |
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Department of Finance and Tax
2023
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| _version_ | 1867614147175251968 |
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| access_status_str | Open Access |
| author | Boynton, Matthew |
| author2 | Ouwehand, Peter |
| author_browse | Boynton, Matthew Ouwehand, Peter |
| author_facet | Ouwehand, Peter Boynton, Matthew |
| author_sort | Boynton, Matthew |
| collection | Thesis |
| description | We study a model of the firm, with perpetual debt and a continuously payable coupon as well as the possibility to raise cash via equity issuance. Excess cash is paid back to shareholders either via dividends or via buybacks. The number of shares changes when equity is issued and when the firm buys back shares. Using this model we track the total number of shares in issue. Then we use finite difference methods to investigate the differences in pricing options on a fixed portion of equity and options linked to the share price, as well as implications for American options on equity. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/37973 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:47:25.118Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2023 |
| publishDateRange | 2023 |
| publishDateSort | 2023 |
| publisher | Department of Finance and Tax |
| publisherStr | Department of Finance and Tax |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/37973 A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh Boynton, Matthew Ouwehand, Peter Mathematical Finance We study a model of the firm, with perpetual debt and a continuously payable coupon as well as the possibility to raise cash via equity issuance. Excess cash is paid back to shareholders either via dividends or via buybacks. The number of shares changes when equity is issued and when the firm buys back shares. Using this model we track the total number of shares in issue. Then we use finite difference methods to investigate the differences in pricing options on a fixed portion of equity and options linked to the share price, as well as implications for American options on equity. 2023-06-27T12:57:25Z 2023-06-27T12:57:25Z 2023 2023-06-27T12:55:38Z Thesis / Dissertation http://hdl.handle.net/11427/37973 eng application/pdf Department of Finance and Tax Faculty of Commerce |
| spellingShingle | Mathematical Finance Boynton, Matthew A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| title | A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| title_full | A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| title_fullStr | A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| title_full_unstemmed | A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| title_short | A study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| title_sort | study on the effect of dilutions and buybacks on the pricing of equity and stock based claims using a finite difference mesh |
| topic | Mathematical Finance |
| url | http://hdl.handle.net/11427/37973 |
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