Investing in shares
An individual can invest in shares of a company that is registered on a stock exchange and get a piece of its future earnings and value. how to buy shares in a company The company's capital is divided up into many equal parts, called shares.
Shareholders are those who purchase these shares. The shares represent ownership of a company. It is also called as equity and preference shares. By investing in shares you become part owner of a company, and receive a share in the future value and profits.
1. Your share value increases as value of the company increases.
2. Dividends are the profits that investors receive. The income payments are the dividends. They do not take this money as reinvestment for the company.
3. These dividends are taxed effective.
4. If shares are held for more than 12 months a 50% discount on any capital gains tax payable.
5. Capital gains will be yours when you sell at a price higher than the price you actually purchased the shares at.
Shares are small parcels that represent different companies. They can increase or decrease the value of the company. The best shares are for those who have a long-term saving plan, a longer investment period, and want to get high returns on long-term investments. The performance that the company has grown is shown in the profits. Future prospects of the investment holders and the company will increase more. The shareholders are responsible for any capital losses. The amount varies depending on the share and company.
Prices of shares can fluctuate from one day to the next and even on the same date. Due to the rise and fall of the economic confidence or changes in a particular industry the increase or decrease in value occurs in the share market. When you make the share investments as long term investment you are sure to secure your future. You can sell your shares if you require a large amount of liquidity.
Share trading agencies assist in buying or selling shares through demat accounts from identifiable companies. Preferential and equity shares are issued by the company's at par and issue price is the par value or the face value of the share and the number of shares multiplied by the face value is the stock held by the shareholder. Every day the exchange quotes the market price and share brokers and mediators will become the causes for the odd fluctuations in the market. When the market price is lower than the face value, a discount sale will occur. When the share's market price exceeds its face value, it is called a premium sale. Dividend given by the company is expressed in % .The shareholders can check their investments the daily i.e., Monday to Friday through newspapers, TV media and Internet.