Dilution occurs when a company issues new stock which results in a decrease of an existing stockholder’s ownership percentage of that company. This often happens when companies like startups need to raise additional capital. The introduction of new shares dilutes the ownership percentage of existing shareholders.
« Back to Glossary Index
About the author
Jenna Lofton, MBA is a stock trading and investment expert with over a decade of experience in the financial industry. She began her career as a financial advisor on Wall Street and now helps everyday investors make smarter financial decisions through StockHitter.com.
Her insights simplify complex financial topics into actionable strategies for beginners and seasoned traders alike.