金融讲义补充资料.docVIP

Unit Five Stock Market Stock is simply a piece of paper certificate that shows the holder is a partial owner of a business firm for his capital contributed to the corperation. It is also the claim to share the net income and residual assets of a business firm. Share is any of the units of equal value into which a company is divided and sold to raise money. Shareholder is an owner of shares in a company or business. Equity holder is a person who holds shares of stock in a corporation. Dividend is an amount of the profit that a company pays to people who own shares in the company. Stock Market is a market where shares of stock are exchanged. It is composed of various Stock Exchanges. Common Stock represents the basic ownership claim in a corporation. Stockholders have one vote per share on items of major interest, such as corporate charter amendments and the election of boards of directors, and have equal claims (per share) on corporate earnings. Preferred Stock differs from common stock in that its cash dividends are payed at a specified rate and it has preference over common stock in the payment of dividends and the liquidation of assets. It does not ordinarily carry voting right. Differences between common stock and preferred stock Common stock 1. has the right to vote; 2. the dividends are floating; 3. common stock holders get the payments after debt holders and preferred stock holders. Preferred stock 1. has no right to vote; 2. can only get dividends at a specified rate; 3. get the payments before common stock holders and after debt holders. The relationship of stock, bond security Securities are certificates with par value proving that somebody is the owner of shares or creditor of a particular company. Thus securities include stocks and bonds. Difference between stock and bond Item Right to vote Issuer Return of principal Risk Bond No Government Businesses Financial institutions Circulated Transferred Can get back Has less risks stock Yes Joint-stock c