investing
dilution
The reduction in existing shareholders' ownership percentage caused by the issuance of new shares.
Example
"When the company issued new shares to raise capital, existing shareholders experienced dilution."
💡 Memory Tip
Like diluting juice with water — adding new shares DILUTES the ownership of existing shareholders.
Etymology
From Latin 'diluere' meaning 'to wash away' — existing ownership is washed away by new shares.
Common Misspellings
dillutiondilutiondilushiondiluton
Related Terms
See Also
shares