In the page "Investing in stocks and shares" from the author Mr.John White, we find information about what shares are. Firstly, shares give investors: a share in its dividends, a stake in the companie's assets and property and a vote, all depending on the size of the investor's holding.

The text describes the assets as the company's stock and its cash-in-hand property less its liabilities.
Usually, shares have a nominal value that add up to the issued share capital of the company. Shares known by the suffix "A" are non-voting shares but they are out of fashion and transforming to voting status.

As well as this, the dividend of a company is the proportion of its profits paid to its owners. The part that is not paid, is retained for the company's growth. The company's profits reprent its earnings.When the earnings are divided by the number of shares in existence, we get the 'earnings per share'. For example: a P/E of 10 means that ten years of earnings will pay for the price of the share.

Finally, the article mentions the Yield which is an important measure of a company's perfomance in it's yield. It is usually the net perventage of the share price. The yields in each country are usually lower than the interest although they could be obtained by investment in local bonds, or in the local equivalent of a building society.

Mark = 5

Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License