About Share Marketing
A stock is a general term used to describe the ownership certificates of any company.A share, on the other hand, refers to the stock certificate of a particular company.Holding a particular company’s share makes you a shareholder.
What is Stock?
There are two types of Stocks—common and preferred. The difference is while the holder of the former has voting rights that can be exercised in corporate decisions, the later doesn’t.However, preferred shareholders are legally entitled to receive a certain level of dividend payments before any dividends can be issued to other shareholders.
There is another term called ‘convertible preferred stock’. This is basically a preferred stock with an option of converting into a fixed number of common shares, usually any time after a pre-determined date.
Working of Stock?
For every stock transaction, there must be a buyer and a seller. When you buy 1000 shares of stock ,someone else must sell it to you. Either buyers or sellers can be more aggressive than the other, pushing the price up or down.
When the price of a stock goes down, sellers are more aggressive because they are willing to sell at a lower and lower price. The buyers are also timid and only willing to buy at lower at lower prices. The price will continue to fall until the price reaches a point where buyers step in and become more aggressive and willing to buy at higher prices, pushing the price back up.
How Stocks prices work?
Many new investors don’t understand the actual mechanics behind making money from stocks; where the wealth actually originates or how the entire process works. If you’ve spent a lot of time on the site, you see that we provide resources on some pretty advanced topics – financial statement analysis, financial ratios, capital gains tax strategies through a simplified way of training.
If you have any doubts about your investment, feel free to connect us!!