Share
Also called: stock, equity share
One equal unit of ownership in a company. Owning shares makes you a part-owner of the business.
A company's ownership is divided into a fixed number of equal shares. If a company has 1,00,000 shares and you own 1,000, you own 1% of it.
A share gives you a claim on the company's profits (through dividends), a vote on major decisions, and the right to sell it to another investor. It does not give you any particular asset of the company, and it carries no guarantee of any return.
Example
You own 500 shares of a company that has 10 crore shares in total. Your stake is 500 ÷ 10,00,00,000 = 0.0005%. If the company pays a dividend of ₹4 per share, you receive ₹2,000.
Learn more in these lessons
- What is a share?What does owning a share actually mean?
- What is the stock market?What is the stock market and how does it work?
- Why companies issue sharesWhy do companies sell shares to the public?
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