Presented By: Dinesh Sharma Manjunath Paramesh.

K Iliyas

A share is a document which is issued by a company, registered with the stock exchange, by which the holder of the share becomes one of the owners of the company.
Two of the biggest stock types are preferred stock shares and common stock shares/ Equity Shares.

Equity shares/common shares/ordinary shares.

These shares are the most commonly traded shares, and they give you a vote in company matters. Equity shares can be purchased from the stock market or from the company when it announces public issue of its stock. They earn a dividend as long as the company is earning money, and this dividend directly corresponds to the profit made by the company. High profits mean high dividends for you. Ordinary shares have no special rights or restrictions. Whilst they have the highest risk, they also have the potential to bring the biggest financi

Equity is the extra or surplus of profit left over to be distributed between investors, after all the liabilities are paid off.
According to section 85 (2), of Companies Act, 1956, Equity share can be defined as the share, which is not preference shares. In other words equity shares are those shares, which do not have the following preferential rights:
(a) Preference of dividend over others. (b) Preference for repayment of capital over others at the time of winding up of the company.

It is a financial instrument through which it bestows ownership rights to the investor in the company.
The owner has a right on the profits and on the companys assets in case of liquidation of the company. They have voting rights in the company. They are distributed the surplus of profits after the interest is settled, taxes paid and depreciation provided and preference shareholders are cleared.

The financial standing, its progress and strategies for growth of the company determines the share prices.
These equity shares can be bought at the stock exchange, through stock brokers, online brokers and sometimes in banks and Though the creditors and preferential shareholders invest cash, they have no say in the conduct of business while the equity shareholders have full powers to direct the company.

Blue Chip Shares Penny stocks Income Shares Growth Shares Cyclical Shares Defensive Shares Speculative Shares Value shares

The equity share holders have many limitations as far as income is concerned.
Even when there are profits, they get their share at the last which means the amount of sharing gets reduced. The preferential shareholders and creditors are paid interest income even if the company is in loss but the equity shareholders get their share only if company makes huge profits.

The rate of dividend on such shares is not predetermined, but it depends on the profit earned by the company.
These shares are also known as Risk Capital, because they get dividend on the balance of profit if any, left after payment of dividend on preference shares and also at the time of winding up of the company, they are paid from the balance asset left after payment of other liabilities and preference share capital.