40 Things To Know Before Entering The Stock Market

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2. Shares 

Shares are the basis of a stock. Someone who owns a percentage of a company’s share has a part of the ownership that is proportional to the size of their share. The total amount of shares a company is comprised of is announced at the time a business is created. Existing shareholders do have the option of authorizing additional shares to be issued by their company due to their roles within the company.

Businesses can decide different types or classes of shares that come with distinct share values, rules, and privileges within the company. A company will issue a stock certificate by declaring ownership of shares. This legal document details the number of shares a shareholder owns, as well as their value.