Shares1954

This text explains the meaning of several aspects such as shares, assets, nominal share value, the dividend, the price of Earning ratio and yield.

It says that the most important thing of share is its dividend and it gives the investor a stake in the company’s assets and also a vote in the annual general meeting that is proportional to the size of the investor’s holding.

The subtraction of the abilities of the company minus the company’s stock of raw materials and cash is the calculation to find out the assets of a company.
The nominal share value define that shares represented the asset value of a company; This means that shares can be sold at a different price, which is usually 25p, from its nominal value.
There are other kinds of shares that are represented with the suffix “A”, the different main characteristic of these type of shares is that the holder has no vote in the company’s strategy. The purpose of these shares was to control the voting stock but they were unpopular with mayor investors, they traded at a lower price and hey were becoming old fashioned.

The definition of the dividend of a company is the proportion of its profits paid to the shareholders. However, a company only pays parts of its profits as a dividend and the rest is used to fund internal growth of the company, the cover of the dividend is the number of times that a company could have paid its net dividend.

The price to earnings ratio (P/E ratio) is the division of the profits by the number of shares in existence. It is used to measure the number of shares in existence. It is used to measure the number of years of earning per share are needed to pay for the current share at the current price of the share. It is expected that the earnings and dividends will rise each year.

The yield is expressed as a net percentage and is usually lower than the rest because of the safety in their investment.

Mark = 6

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