ALL ABOUT ‘SHARES’ AND ‘SHARE MARKET’
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(No Ratings Yet) Loading ...By divya
Published: August 14, 2009
Investing in the share market has become the latest trend amongst the common public, as it gives high returns and at the best scenarios doubles the idle money.
So What is a SHARE?
A Share also known as stock is a financial asset, which can also be termed as an unit or part of ownership of a company. It is a document provided by the company which tells you the percentage of ownership of the company.
When you hold a certain percent of a comapany’s share, it means you are owning the company’s assets for that particular percentage. The one who owns the share is called the Share Holder.
Share Market – Basics
A Share market is a common place where an investor buys and sells shares of different companies. Like any other market, it is a place where buyers and sellers negotiate.
Issue Of Shares – Why???
Companies issue shares to the common public inorder to raise capital for multiple reasons such as
- to start a business (initial capital)
- to purchase new equipments
- to enhance their business
- to deversify their business etc.
Why Invest in Shares?
By investing in shares, you earn “capital gain” and “profit”. Say for example you buy a share at a lower price and sell when the price moves up.
Then you earn a capital gain and as a Share holder you are entitled to receive any profits the company make which is known as the dividend. A dividend is the earnings a company makes.
If you hold 10% of the company’s share, then you will be given 10% of the profit the company makes.
Risks involved in Investing
Share Market is an unstable platform. Share prices may vary on a daily basis. Due to fall and rise in the share prices, investors are affected. Indeed a high risk is involved when you invest your hard earned money in the stock market.
However, you can avoid certain amount risk by doing some ground work of studying the market behaviour for a certain period of time and invest in those shares which had a steady growth time to time.
So make a smart move for a smart investment. Best of Luck!!!
Tagged with: Dividend, Investment, Share, Share Holder, Share market
