CHAPTER 4

Investments and Shareholders

Discipline is always the difference between winners and losers.

Types of Shares

Shares are sometimes referred to as stocks, securities, or equity.

There are two main types of stocks: ordinary shares (also called common stock) and preference shares.

Ordinary Shares (Voting)

The global norm is for companies to issue ordinary shares, which are the main types of stocks traded in the market. These represent ownership in a company in the proportion of shares held. In addition to capital growth investors also receive a portion of profits in the form of a dividend. Some countries require that financials are declared every quarter, while some have two sets of financial releases a year.

As part owner of the company, ...

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