Equities
Equities (stock or share) – A type of security that signifies ownership in a corporation and represents a claim on part of the corporation’s assets and earnings. There are two main types of stock:
Common stock usually entitles the owner to vote at shareholders’ meetings and to receive dividends Preferred stock generally does not have voting rights, but has a higher claim on assets and earnings than common
- Capital growth: Increase in share market value. Please note that shares can also lose value, as stock prices can fall below your purchase price due to macroeconomic or company-specific factors.
- Dividends: Share ownership incentive given by a company to its shareholders, usually as a share of profits. Some companies pay dividends regularly while others seldomly pay or not pay at all. Some companies also allow you to reinvest dividends into new shares.
- Buying and selling: Shares listed on NSE are easily traded and market makers also help provide liquidity. Investors can buy or sell quickly through a licensed stockbroker. Brokerage fees for executing a trade are usually a fixed fee or a small percentage of the value of the shares traded.
- Shareholder rights: As a shareholder in a listed company, you will have the right to receive company information and to vote at annual general meetings. You can also have the right to participate in some further share issues by the company, such as rights issues. Your rights may vary depending on the type of shares that you hold.
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