Corporate Stock参考.ppt

Corporate Stock ? Learning Objectives ? To learn about the characteristics of common and preferred corporate stock. To understand the organization and operation of the stock market today. To compare and contrast the roles and functions of the organized stock exchanges and the over-the-counter market. To explore the issue of market efficiency. Characteristics of Corporate Stock All corporate stock represents an ownership interest in a corporation, conferring on the holder a number of rights as well as risks. Common stock represents a residual claim against the assets of the issuing firm, entitling the owner to share in the net earnings of the firm when it is profitable and to share in the net market value (after all debts are paid) of the company’s assets if it is liquidated. Characteristics of Corporate Stock Preferred stock carries a stated annual dividend expressed as a percent of the stock’s par value. Preferred stockholders have a prior claim over the firm’s assets and earnings relative to the claims of common stockholders, although creditors must still be paid first. Preferred shares generally provide less income but are less risky than common stock. Stock Market Investors Recent Movements in Common Stock Prices Recent Movements in Common Stock Yields Characteristics of the Corporate Stock Market There are two main branches of the market for trading corporate stock. Organized exchanges – Trading is governed by regulations and formal procedures designed to ensure competitive pricing and an active market for the stock of the largest firms. Over-the-counter (OTC) market – This more informal market involves the trading of stock through brokers. The Major Organized Exchanges The New York Stock Exchange (NYSE) and Chicago Board of Trade (CBOT) are organized exchanges. They have: a physical location for trading trading posts formal trading rules listing requirements a board of directors member firms and seats The Informal Over-the-Counter Market There is no central t