Monday 24 December 2018

Stock – Definition | Types | Factors

The stock is a sign of participation capital in the limit liability company as it has been known that the purpose of the financier buying shares to gain income from the shares. The community financier was categorize as an investor and speculator. Investors here are the communities that buy shares to have company in the hope of getting a dividend and capital gain in the long term, whereas the speculator is a society that is buying stocks for immediate resale when the exchange rate situation consider the most profitable as it has been known that stocks provide two kinds of income i.e. dividends and capital gains.

There are various definitions of stocks that have been express by the experts as well as a variety of textbooks, among others:

According to Stocks is the purest and simple form of ownership of the company.

  • The stock is a piece of paper stating the ownership of the company.

  • The stock is a security who has a claim against the income and assets of a company. Securities alone can be interpret as a claim on future income a borrower is sold by the borrower to a loan, often call financial instruments.


Type of stock:


in a transaction at the stock exchange, stocks or also call the share was the most dominant instrument is trade. The shares can be issue in a manner on behalf of or for the. Next shares can be distinguish between common stock (common stocks) and prefer shares (prefer stocks).

Common shares (Common Stock)


The common stock is the effect of the inclusion of ownership (equity security) of the business entity in the form of a limit liability company. A common stock gives the guarantees to participate could ascertain the Division of profit could ascertain the form of dividend, if the company is gaining profit.

The characteristics of common stock are as follows:

  • Dividends paid out all the company gain profit.

  • Has the right voice (one share one vote)?

  • Right of acquiring wealth division of the company when it went bankrupt after the company repaid all the obligations.


Prefer stock


Is a stock that has a mix of bonds and common stock. As for the distinctive Profitable from prefer stock is:

  • Has the right most first obtain dividends?

  • Do not have voting rights,

  • Can affect the management of the company especially in the nomination of the Executive Board.

  • Have the right the maximum payout of nominal value of the shares first after creditors if the company is liquidate.



Stock price:


the stock is a sign of participation or the ownership of a person or body in an enterprise, a piece of stock is a sheet of paper that explains that the owners of the paper is the owner (regardless of the portions/number) of a company that publishes the paper (stock). Stock price can be differentiate into 3 (three):

Nominal price is


The prices state in the certificate of issuance to assess each sheet of the shares were issue. The amount of the nominal price provides the minimum dividend is usually define base on nominal value.


The price of Prime


tidy up this price at the time the share price is record on the stock exchange.
The price of shares in the primary market are usually set by the underwriter (underwriter) and issuers. Thus be known how stock prices issuers that will be sold to the public usually determine price.


The market price


If the price of Prime tidy up sale price of emissions agreement to investors. Then the market price is the selling price of the one with investors that lam. This happen after the price of the shares list on the Exchange. The deals here are no longer involve issuers Vicarious underwriters price it is refer to as the price in the secondary market and the price is what really represents the company's Publisher, because prices on transactions in the secondary market, tiny occurs negotiations with investors price publishing company. Prices per day post in newspapers or other media is market price.

Stock price Factors


Factors that could affect the stock price movement is a projection of earnings per shares, when it obtain a profit, the level of the risk of profit projections, the proportion of the company's debt against equity, as well as the Division of policy dividends.

Other factors that can offend the movement of the stock price is a constraint external such as the activities of the economy in General, taxes and the State of the stock market. Degradation -true investment realize that next will get benefit not closing the possibility they will suffer losses.

The gain or loss is significantly influence by the ability of investors. To analyze the State of the do it stock price valuation shortly that is affect by many factors including the condition [performance) from the company. Constraints external, power supply and demand for shares in the market. As well as the ability of investors in analyzing the investment shares:

"The main factor that cause the stock price is a different perception of each investor in accordance with the information obtain".

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