2. What is a Stock?
Name used to describe money raised by a joint stock
company or corporation, or a government.
3. Who Owns the Company?
Shareholders: any person or organization that buy and
hold shares in a joint stock company.
4. What is
Market Capitalization?
The market value of all shares or equity issued by a
company.
5. Why Buy Stocks?
As an investment, hoping stock prices will rise over
time.
Shareholders are entitled to a share of any profits
made by the companies they own. The profit is called
a dividend.
The more shares a stockholder holds, the more
dividend he/ she receives.
6. Permanent Capital
Money raised from the issue and sale of shares is NOT
a loan.
Shareholders have to sell their shares to get their
money back.
7. Where to Buy/ Sell Shares?
New York Stock Exchange (NYSE)
National Association of Securities Dealers Automated
Quotations (NASDAQ)
Tokyo Stock Exchange
London Stock Exchange
Shanghai Stock Exchange
Hong Kong Stock Exchange
Major stock exchanges: as at 31 December 2011
8. What is a Floatation?
Involves a new company issuing shares for the first
time for sale through a stock exchange.
9. What is a Bond?
Governments can raise money to finance public
expenditure through the sale of government loan
stocks or bonds.
10. Functions of a
Stock Exchange
A business organization that enables
individuals, companies and governments to buy and
sell shares on the global stock market.
Most important source of finance for most companies.
11. Functions of a
Stock Exchange
It brings together buyers and sellers of new and
second-hand stocks.
It provides up to the minute information on the market
prices of different stocks and quantities traded.
It supervises the conduct of firms of brokers that buy
and sell shares on behalf of investors.
12. Functions of a
Stock Exchange
Most trading in stocks and shares is now conducted
electronically.
The NASDAQ was the first electronic stock
exchange, founded in 1971.
http://www.nasdaq.com