An increase in the number of shares of a company’s stock, causing the value of each share to decrease.
The number of shares increases when the company offers new stock to the public to raise cash; or when employees exercise their stock options; or when holders of convertible bonds convert their bonds to stock. Companies that can afford to will frequently buy back issues of stock to fight dilution.

« Back to Glossary Index
Sites DOT MIISThe Middlebury Institute site network.