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Securities
Vereinigte Ostindische Compagnie bond.jpg

Securities
Bond
Equities
Investment Fund
Derivatives
Structured finance
Agency securities

Markets
Bond market
Stock market
Futures market
Foreign exchange market
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Over-the-counter Market (OTC)

Bonds
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Bonds by issuer
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Pfandbrief
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Equities (Stocks)
Stock
Share
IPO
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Investment Funds
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Structured finance
Securitization
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Tranching
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Collateralized fund obligation
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Credit-linked note
Unsecured bond
Agency Securities

Derivatives
Options
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Forwards
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Credit Derivatives
Hybrid Securities

[Template:Securities&action=edit edit this box]

In financial markets, a share is a unit of account for various financial instruments including stocks (ordinary or preferential), and investments in limited partnerships, and REITs. The common feature of all these is equity participation (limited in the case of preference shares).

The term stocks in the plural is often used as a synonym for shares.[1] Traditionalist demands that the plural stocks be used only when referring to stock of more than one company are rarely heard nowadays.

Contents

Shareholders and dividends

The income received from shares is called a dividend, and a person owning shares is called a shareholder. This is usually in a large and medium sized business but not necessary in a small business which is more focused on trying to survive.

Valuation

Shares are valued according to various principles in different markets, but a basic premise is that a share is worth the price at which a transaction would be likely to occur were the shares to be sold. The liquidity of markets is a major consideration as to whether a share is able to be sold at any given time. An actual sale transaction of shares between buyer and seller is usually considered to provide the best prima-facie market indicator as to the 'true value' of shares at that particular moment.

Tax treatment

Tax treatment of dividends varies between territories. For instance, in India, dividends are tax free in the hands of the shareholder, but the company paying the dividend has to pay dividend distribution tax at 12.5%. There is also the concept of a deemed dividend, which is not tax free. Further, Indian tax laws include provisions to stop dividend stripping.

Share certificates

A share entitling to 1/8 of the Stora Kopparberg copper mine in Sweden dates back from 1288. The first share company in the world

Investors were given share certificates as evidence of their ownership of shares but certificates are not always issued nowadays. Instead, the ownership may be recorded electronically by a system such as CREST.

See also

References

  1. ^ Compact Oxford English Dictionary

cnnmoney.com [1]

External links

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