About Shares – What are Shares ?


Before we understand what are “Shares”? in business finance, we need to understand “Capital”.

Capital is the money or the amount of investment a Promoter invests in his business.
If the Promoter of a business is the sole investor than the Capital is a “proprietary capital” so also the business is called as Proprietary Business.
If the Promoter has joined hands with one or more Promoters with or without capital investments by other promoters then the business is partnership and so also the Capital are shared among the partners as per the agreement between the partners.

Since the dawn of Industrial Revolution it was realized that the required capital  to start, expand or run an organisation was more than what could be introduced by a person or group of people, then the Promoters divide the required Capital into equal denomination (e.g $1, Rs 10/-) in to singular units termed as “Share” and the capital is called as “Share Capital”. The idea of dividing the Capital is to bring in more number of investors to share the liability of investment to start, expand or run the business.These investors came to be known as Shareholders and become the part owners in the Company to the extent of their percentage holding of shares in that company.

The Promoters at the time of selling the Shares clubs them into lots (e.g 50 shares, 100 Shares etc.) and such lots are called as Stocks and the organisation is called a joint Stock Company.

Over a period the Shares are sold in different forms
1. Preference Shares : wherein the holder of such share will receive a fixed amount of returns usually expressed in percentages e.g 10% per annum, on the value of his Share holding. The preference Share holder will not have any Share in the Profits of the company but will have preference in his returns to be paid by the Company irrespective of the Profits.
2. Equity Shares : the Share holder of such Share will have a pro rata interest in the Profits/Losses of the Company to the extent of the percentage Shareholding.The profits will be shared as Dividend and/or Bonus and the losses will be set-off against the Share Capital i.e. reduced from the Share Capital.

Thus a Share is nothing but an instrument of ownership jointly divided among various shareholders.

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Deemed Conveyance & Redevelopment of Old Buildings and Slums

PHYSICAL SHARES, DELISTED SHARES, Untraded, Unlisted, Non-Traded, Unquoted, Suspended, Illiquid, Junk Stocks, Shares - This blog provideds you a plotform to BUY/SELL such Shares.

Dunlop

PHYSICAL SHARES, DELISTED SHARES, Untraded, Unlisted, Non-Traded, Unquoted, Suspended, Illiquid, Junk Stocks, Shares - This blog provideds you a plotform to BUY/SELL such Shares.

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