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Importance of finance_terminology

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Share
(finance)
Securities
In financial
markets, a share
is
a
unit of
account
for
various
financial
instruments
including
stocks
(ordinary or
preferential), and investments
in limited
partnerships, and real estate
investment trusts.
The
common feature
of all
these
is
equity participation
(limited in
the case
of
preference
shares).
A unit of ownership that represents an equal proportion of a company's capital. It entitles its
holder (the shareholder) to an equal claim on the company's profits and an equal obligation
for the company's debts and losses.
Two major types of shares are (1) ordinary shares (common stock), which entitle the
shareholder to share in the earnings of the company as and when they occur, and to vote at
the company's annual general meetings and other official meetings, and (2) preference
shares (preferred stock) which entitle the shareholder to a fixed periodic income (interest)
but generally do not give him or her voting rights. See also stock.
A
corporation divides
its
capital
into
shares,
which
are offered
for
sale
to
raise capital, termed
as issuing shares. Thus, a share
is
an
indivisible unit of
capital, expressing the contractual
relationship between the company and
the
shareholder.
The
denominated value
of
a share
is its
face value:
the total
capital
of
a company
is divided into
a
number
of
shares.
[2]

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The income received
from
shares
is
known as a dividend.
A
shareholder, also known as a
stockholder,
is
a person
who owns
shares
of
a
certain
company
or
organization.
[3]
The
process
of
purchasing
and selling
shares
often
involves going through a stockbroker as a middle
man.
[4]
Valuation
Shares are valued according
to
various principles
in
different markets, but a basic premise
is
that a
share
is
worth
the
price
at which
a transaction
would
be
likely to
occur were the shares
to
be sold.
The
liquidity of
markets
is
a
major
consideration as
to
whether a share
is
able
to
be sold at any
given time.
An
actual sale transaction
of
shares
between
buyer and seller
is
usually considered
to
provide the best prima facie market indicator as
to
the "true value"
of
shares
at that particular
time.
Concept
of
Share
In
practical terms, shares are
individual
pieces representing
an
equal stake
in
the
capital
of
a
business organization.
The
number
of
shares make
the
respective holder
eligible
to
receive a certain
part of the profits
made
by that
company.
The
shares also
help the
respective
holders
to be
able
to lay claim to
a
part of the
worth
of
the specific company. This
is
applicable,
however,
only
when there
is liquidation.
Definition
of
Share
According
to
financial terminology the share
is
regarded as a
unit of
account
that can represent several monetary instruments, such as stocks, REITs, mutual funds,
or limited
partnerships.
In
Great
Britain
the
term
"shares" usually refers
to stocks.
Dividend
The earning that the holder
of
a share makes
from his or
her shares
is
called the
dividend. Dividends
are actually part of the profits of the
company
whose
shares
may be
held by the
respective
holder.
These
are
non-reinvested
profits
Tax
treatment
Tax
treatment
of
dividends varies
from
territories
to
territories.
For
instance,
in India,
dividends
are
tax
free
in the
hands
of
the shareholder,
but
the company paying the dividend has
to
pay
dividend distribution
tax at
12.5%.
There is
also the concept
of
a deemed dividend,
which is not

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Share (finance) Securities In financial markets, a share is a unit of account for various financial instruments including stocks (ordinary or preferential), and investments in limited partnerships, and real estate investment trusts. The common feature of all these is equity participation (limited in the case of preference shares). A unit of ownership that represents an equal proportion of a company's capital. It entitles its holder (the shareholder) to an equal claim on the company's profits and an equal obligation for the company's debts and losses. Two major types of shares are (1) ordinary shares (common stock), which entitle the shareholder to share in the earnings of the company as and when they occur, and to vote at the company's annual general meetings and other official meetings, and (2) preference shares (preferred stock) which entitle the shareholder to a fixed periodic income (interest) but generally do not give him or her voting rights. See also stock. A corporation divides its capital into shares, which are offered for sale to raise capital, termed as issuing shares. Thus, a share is an indivisible unit of capital, expressing the contractual relationship ...
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