Investing in Stocks

Chapter: 5 Investing in Stocks

Section: 1 What is a Stock?

A stock or share is an investment that represents a fraction of ownership in a company. The total sum of capital required for a business venture is divided into a number of equal value stocks and offered to the investor community for subscription. The raised capital is invested in business in the form of land, buildings, machinery, vehicles, inventory, computer systems etc. When you buy a stock, you have an ownership share in that corporation and you are entitled to part of that corporation's earnings and assets. The owner's money in the company is called equity and investors who own shares in a company are known as shareholders.

 


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