Shares_1323

At the website http://www.howtobooks.co.uk/family/stock-shares/ we can find an article taken from the book “Stocks & shares”, which was written by Dr. John White. In that article Dr. John White talks us about some basic and very important economic concepts, specially connected with the stock market. Those economic factors are:

Share: A share represents the stake of its owner in a company. It gives power in proportion to the company size and the number of shares in which it is divided. Also it gives its owner the right to vote in the annual meeting.

Nominal Share Value: The amount of capital that has been issued by the company when the shares are sold at a value that reflects the earning capacity in the market. They are also known as stock.

Non-voting shares: They differ from the other shares because these ones do not give voting rights. Therefore, their price is lower than the price of the rest.

Dividends: Is the profit, in proportion, of the shareholders. The money which is not destinated to the dividend is invested to pursue development of the company, or it will be used for paying new dividends later. The cover is the number of times that a company could have paid its dividends.

P/E Ratio (Price to earning ratio): This ratio calculates how many years of earnings per share should pass to recover the consideration paid by such action.

The Yield: This measure expresses the value, or in this case, more specifically, the company's performance, as a percentage of the share price.

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