Vii. What is a stock?

Even for the veteran of the stock market, it may be useful to review the basics of stocks.

The essence of shares is simple, which is part of the ownership of a company. Stock is the certificate of Ownership, which represents the shareholder's interest in the company, including the company's assets, liabilities, income and so on. Holding a company's shares means that you are one of the owners (shareholders) of the company and therefore have a right to everything that belongs to the company. Wang II If you have one-of the total number of shares issued by a car company, theoretically he owns the company building, trademark, patent, car, reputation ... of one-.

Historically, a share was represented by a stock. In today's information technology age, you will not actually see these magical pieces of paper, but will only have electronic records on stock accounts. The benefits of doing so are obvious. In the past, if a person wanted to sell his shares, he had to go to the broker with the paper proofs. Now, investors need only in the air-conditioned room to exercise a few of the index finger joints or on the subway dot mobile phone screen, you can lose or earn a pack of cigarettes two ham sausage.

Responsible for the management of the company's daily operations by the company's shareholders, to maximize the interests of shareholders to serve the goal, can be a professional manager, can also be a major shareholder himself. But buying a company's thousands of-lot stock does not mean you have a say in the company's daily operations. Your opportunity to exercise divine rights is reflected in the general meeting of shareholders, a vote on various matters. There are too few shares of retail investors to go abroad to meet and commuting costly, so shareholder meetings are usually just big shareholders. So the small shareholder has no effective influence on the operation of the company, the stock of Vanke does not mean that you can call Wang Shi and tell him how you think the price should be located. Of course, the major shareholders of Qingdao stock, to go to the supermarket to get beer is also to pay, and no concessions.

For ordinary investors, can not participate in management is not a big deal. After all, the ideal is not to take the money without work? The significance of becoming a shareholder is that you have a right to the assets and have the right to profit from your share of the company. Profits are sometimes paid in the form of dividends, with more shares and more dividends. This is also the ideal situation, China's stock market dividend distribution is far less common than in the western mature stock market. The right to assets is not redeemable until the company goes bankrupt. In case of this naïve coming, after all creditors are repaid, you may be able to get some leftovers cold.

The right is the responsibility, an important feature of the stock is its limited liability, or the company that issued the stock belongs to the type of corporation. As the owner of a stock, if the company is unable to repay the debt, you are not personally responsible. Other types of business, such as an unlimited liability partnership, can be used against a partner's individual in bankruptcy, asking him to sell all the things that can be sold, such as selling cars, until the debt is repaid. In contrast, owning a stock means that the maximum you can lose in any case is the amount you invest, and the ashtrays, cats, dogs and flowers in your home are safe.

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Vii. What is a stock?