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Showing posts with label share market tips for beginners. Show all posts
Showing posts with label share market tips for beginners. Show all posts

Sunday, February 17, 2013

What does 'Share' and 'Share holder' mean in Stock market

What is share?
 For raising capital the companies divide its ownership into small parts and issuing to individuals or organizations.Each part is called a share.Shares of Corporations, mutual funds and Organizations are available.
 In financial markets, such as stock markets and commodities markets share is considered as an unit of account.The share holders of the company will get income from shares, which is known as 'dividend'.

Share Holder
 A share holder is a person or an institution who carries share in a company.Thus he is the owner of a part of that company.A person holding maximum shares in a company has maximum ownership.They will be the directors or Chairman in the company.
 A share holder is also known as 'stock holder' or a 'stake holder'. He can purchase the shares of public or private corporations.He has the right to sell his share any time.He is also eligible to nominate directors or vote for the directors nominated by the board.He will get all dividends declared by the company and also he can purchase new shares issued by the company at any time.
 A share holder purchases shares from an institution called Stock or commodity or currency market.The purchase process is going through a broker.
 One can buy shares from Primary market through initial public offerings (ipo) or bonds.They provides capital directly to the company.How ever the majority of share holders purchase shares from secondary market, in this case the share holder not directly providing capital to the company.