--- title: "Modelling an intermediate securities distribution (RHDI)" slug: "modelling-an-intermediate-securities-distribution-rhdi" updated: 2026-09-03T17:07:31Z published: 2026-09-03T17:07:31Z canonical: "support.lusid.com/modelling-an-intermediate-securities-distribution-rhdi" --- > ## Documentation Index > Fetch the complete documentation index at: https://support.lusid.com/llms.txt > Use this file to discover all available pages before exploring further. # Modelling an intermediate securities distribution (RHDI) You can model an intermediate securities distribution as a corporate action of type `IntermediateSecuritiesDistributionEvent` in LUSID. [See all supported corporate actions](/v1/docs/understanding-dedicated-corporate-action-events). Note the following: - `IntermediateSecuritiesDistributionEvent` is valid for instruments of type `Equity` and `SimpleInstrument`. - A rights issue is modelled as a sequence of two separate corporate actions. `IntermediateSecuritiesDistributionEvent` credits holders with a nil-paid right as an interim security, at no cost. A [CallOnIntermediateSecuritiesEvent](/v1/docs/modelling-a-call-on-intermediate-securities-exri) (EXRI) then resolves that right: the holder either exercises it, paying a subscription price to receive units of the underlying security, or lets it lapse. - Load `IntermediateSecuritiesDistributionEvent` against the *underlying security*. The interim right to be credited is identified by `newInstrument` on the event. This is the opposite way round to `CallOnIntermediateSecuritiesEvent`, which you load against the interim right. - The holding in the underlying security is never debited. This event only adds units of the interim right. - The entitlement date is the `exDate` specified when you load `IntermediateSecuritiesDistributionEvent`, not `recordDate`. - Amounts are calculated from the total number of units held on the entitlement date, settled and unsettled. - The transaction date of automatically-generated output transactions is `exDate`, and the settlement date is `paymentDate`. - There are no elections. Every eligible holder is credited the interim right unconditionally. ## Loading `IntermediateSecuritiesDistributionEvent` You must load `IntermediateSecuritiesDistributionEvent` into a corporate action source registered with one or more portfolios. The event then impacts every registered portfolio with a holding in the underlying security. [See how to do this](/v1/docs/how-do-i-upload-corporate-actions-to-a-corporate-action-source). For more information on fields, see the [IntermediateSecuritiesDistributionEvent](https://www.lusid.com/docs/api/lusid/schemas/IntermediateSecuritiesDistributionEvent/) schema. Where set, the following date validation rules apply: `announcementDate ≤ exDate ≤ recordDate ≤ paymentDate` Only one participation type is valid, and there are no elections to specify: | Participation type | Election(s) | Further action required? | | --- | --- | --- | | `Mandatory` | None. | ❌ No. The distribution applies to every registered portfolio with an eligible holding. | We recommend setting `costFactor` to the proportion of the underlying holding's cost basis to allocate onto the new interim right. Set this to `0` if you want the rights credited at zero cost. ### Handling fractional entitlements Where `unitsRatio` does not divide a portfolio's holding evenly, the entitlement includes a fraction of an interim right. We recommend always setting `fractionalUnitsCashPrice` and `fractionalUnitsCashCurrency`, and `fractionalUnitsRoundingConvention` to control how LUSID resolves it: | Convention | Outcome | | --- | --- | | `Floor` The default, applied where you do not set `fractionalUnitsRoundingConvention`. | The portfolio keeps the whole units of the interim right. The fraction is sold, and the portfolio receives cash valued at `fractionalUnitsCashPrice`. | | `BuyUp` | The portfolio purchases the shortfall to round its entitlement up to the next whole unit, paying cash valued at `fractionalUnitsCashPrice`. Unlike the free entitlement, these bought-up units carry a cost basis. | > **Note**: The `fractionalUnitsRoundingConvention` field is shared with other corporate actions and accepts a wider set of values. Only `Floor` and `BuyUp` have an outcome for this event. ## Configuring the economic impact You must create the following transaction types to handle automatically-generated output transactions. They are not provided for you. | Transaction type | Implement the transaction type if… | Intended economic impact | | --- | --- | --- | | [IntermediateSecurityUnits](/v1/docs/recommended-transaction-types-for-corporate-action-events#intermediatesecurityunits-transaction-type) | Always. This transaction is generated for every eligible portfolio. | Adds units of `newInstrument` at a total consideration of zero. | | [IntermediateSecurityCashInLieu](/v1/docs/recommended-transaction-types-for-corporate-action-events#intermediatesecuritycashinlieu-transaction-type) | A portfolio has a fractional entitlement and the rounding convention is `Floor`. | Removes the fractional unit and adds the cash it was sold for. | | [IntermediateSecurityBuyUp](/v1/docs/recommended-transaction-types-for-corporate-action-events#intermediatesecuritycashinlieu-transaction-type2) | A portfolio has a fractional entitlement and the rounding convention is `BuyUp`. | Adds the units needed to reach the next whole unit, and removes the cash that funded them. | You can give a transaction type any economic impact you like. Our recommendations: - On the units leg, add the units of the interim right at a cost of zero. - On the cash-in-lieu leg, remove the fractional unit and add the cash proceeds. Where the right was credited at zero cost, the whole of the cash received realises as a gain on `ProfitAndLoss/Realised/Market`. - On the buy-up leg, add the units at the fractional unit price and remove the cash that funded them. This is a purchase, establishing a cost basis, so there should be a `ProfitAndLoss/Unrealised/Market` impact. ## Reference examples ### A rights issue with no fractional entitlement Holders receive one nil-paid right for every four shares held. `costFactor`, `fractionalUnitsCashPrice` and `fractionalUnitsCashCurrency` are all supplied even though this ratio produces no fraction for a holding that is a multiple of four. ```json [  {    "instrumentEventId": "RHDI-ACMECORP-2026",    "instrumentIdentifiers": {      "Instrument/default/ClientInternal": "ACMECORP-EQ"    },    "description": "Intermediate securities distribution - Acme Corp (1 right per 4 shares)",    "participationType": "Mandatory",    "instrumentEvent": {      "instrumentEventType": "IntermediateSecuritiesDistributionEvent",      "exDate": "2026-08-15T00:00:00.0000000+00:00",      "paymentDate": "2026-08-20T00:00:00.0000000+00:00",      "newInstrument": {        "instrumentIdentifiers": {          "Instrument/default/ClientInternal": "ACMECORP-RIGHTS"        }      },      "unitsRatio": { "input": 4, "output": 1 },      "costFactor": 0,      "fractionalUnitsCashPrice": 0,      "fractionalUnitsCashCurrency": "GBP"    }  } ] ``` A portfolio holding 4,000 units of Acme Corp on 15 August 2026 is credited 1,000 nil-paid rights at a total consideration of zero, settling on 20 August 2026. Its 4,000-unit holding in Acme Corp is unaffected. ### A rights issue where the fraction is paid as cash The same terms, but a fractional entitlement is valued at 0.80 GBP per right and paid out as cash under the default `Floor` convention. ```json [  {    "instrumentEventId": "RHDI-ACMECORP-2026-FLOOR",    "instrumentIdentifiers": {      "Instrument/default/ClientInternal": "ACMECORP-EQ"    },    "description": "Intermediate securities distribution - Acme Corp (fraction paid as cash)",    "participationType": "Mandatory",    "instrumentEvent": {      "instrumentEventType": "IntermediateSecuritiesDistributionEvent",      "exDate": "2026-08-15T00:00:00.0000000+00:00",      "paymentDate": "2026-08-20T00:00:00.0000000+00:00",      "newInstrument": {        "instrumentIdentifiers": {          "Instrument/default/ClientInternal": "ACMECORP-RIGHTS"        }      },      "unitsRatio": { "input": 4, "output": 1 },      "costFactor": 0,      "fractionalUnitsCashPrice": 0.80,      "fractionalUnitsCashCurrency": "GBP",      "fractionalUnitsRoundingConvention": "Floor"    }  } ] ``` A portfolio holding 4,002 units of Acme Corp on 15 August 2026 has an entitlement of 1,000.5 rights. It keeps 1,000 nil-paid rights and receives 0.40 GBP for the remaining half right, settling on 20 August 2026. ### A rights issue where the fraction is bought up The same terms again, but the `BuyUp` convention rounds a fractional entitlement up to the next whole right instead of paying it out. ```json [  {    "instrumentEventId": "RHDI-ACMECORP-2026-BUYUP",    "instrumentIdentifiers": {      "Instrument/default/ClientInternal": "ACMECORP-EQ"    },    "description": "Intermediate securities distribution - Acme Corp (fraction bought up)",    "participationType": "Mandatory",    "instrumentEvent": {      "instrumentEventType": "IntermediateSecuritiesDistributionEvent",      "exDate": "2026-08-15T00:00:00.0000000+00:00",      "paymentDate": "2026-08-20T00:00:00.0000000+00:00",      "newInstrument": {        "instrumentIdentifiers": {          "Instrument/default/ClientInternal": "ACMECORP-RIGHTS"        }      },      "unitsRatio": { "input": 4, "output": 1 },      "costFactor": 0,      "fractionalUnitsCashPrice": 0.80,      "fractionalUnitsCashCurrency": "GBP",      "fractionalUnitsRoundingConvention": "BuyUp"    }  } ] ``` A portfolio holding 4,002 units of Acme Corp on 15 August 2026 has an entitlement of 1,000.5 rights. It is credited 1,001 nil-paid rights and pays 0.40 GBP for the half right it bought up, settling on 20 August 2026.