Shares And Its Types

Shares & It's Types
A share is subdivision of investments in various parts. One can buy shares based on their capacity & money they have

Example:
X bought 100 equity shares @ 1000 of infosys, the investment limit is 1000 per share. It may go 1200 after some time. X may sell the shares that he has own for 1200 per share. In this process 1000*200, 20000 is x’s profit

Shares Are Of Following Kinds

1. Equity shares
2. Preference shares
3. Employee stock option

• Equity Shares: Equity Shares are the real owners of the company, they will enjoy voting rights in case of any policy making such as bonus issue, splits, buybacks, and others.The ownership is limited to the book value of the share, normally equity shares will trade on stock exchanges.There is no limit of earning in equity shares, your returns may be 10 times or even 100 times if you invest in right stocks, hence equity share holders are the high risk holders.Equity segment are the best segment to earn more money, invest in the right stocks to get good returns. So park your money on right places to get better returns

• Preference shares: Preference shares are issued by the company on preferential bases, the company will give more preference to share holders at the time of company winding up Preference share holders are not the real owners of the company; they won’t enjoy any voting rights. Preference shares won’t give much return as much as equity segment and stocks are less volatile, so you investments are secured, less risk & less returns

• Employee stock options: The company may issue shares to their exiting employees on merit bases; the employees can sell the shares when it goes up Usually this kind of allotments will be done to encourage the employees & to get best output from them. Even employees will show more interest to obtain employees stock option, rather than other perks, benefits of the company, because they will give good returns