SECURITIES IN DETAIL

GUIDE TO STOCKS

One way of investing in a company it to purchase a "share" of the ownership. These shares of a company are know in North America as "stocks" and as a general rule, "shares" in the rest of the world.
Purchasing a share in a company gives the owner a portion of the property and assets. Most shares bought today also give the investor the rite to vote on specific matters including the election of the board of directors and to attend the AGM (Annual General Meeting).
When a company requires capital for expansion or new ventures, or because the owners would like to free some capital for private use, shares are issued and in some cases, can be bought directly from the issuer, but generally are traded on a stock market. Most stocks have a declared nominal value which reflects a value of the company assets. However, when a company issues shares, they may be traded at a higher (or lower) value if the earning potential is seen to be positive. Investors purchase stocks in the hope that they will increase in value & that dividends paid will be good. Dividends are calculated by the company's board of directors and take into consideration the yearly profits.