Stocks
Common Stocks:
Definition: Common stocks represents property monies, the holder of which is entitled to rights, defined by customary and corporate law, and the best description of which comes through the identification of the rights of its campaign.
Rights of ordinary shareholders: The rights enjoyed by the common shareholder in which the Companies Law has the following rights:
- The right to receive its share of the profits when distributed.
- The right to receive its share of the value of the company's assets upon liquidation.
- The right to attend meetings
- The right to vote in cases submitted to the General Assembly of shareholders.
- The right to transfer ownership by means of sale, sale or inheritance.
- The right of priority in the IPO when the company issues new shares.
- The right to be nominated for membership of the Board of Directors. He had the minimum required in the shares.
- Right to elect the Board of Directors and their accountability.
- Right to Profits for reserved.
Premium Stocks:
Are shares issued by companies along with common shares and have been named excellent shares because they differ from ordinary shares that have a right over common shares to acquire their rights.
Difference between common and premium shares:
- Premium shareholders have priority over common shareholders in respect of receiving dividends and funds resulting from liquidation of the company's business in the event of liquidation.
- There is a maximum limit on the amount of return that an excellent shareholder can obtain and is determined by a certain percentage of face value.
- Often, the right of permanent voting is not for the premium shareholders
- Often, the right of permanent voting is not for the premium shareholders
The reasons for the excellent arrow version:
- A kind of investors who do not want to risk a relatively high compared with ordinary shares, such as insurance companies and contractors and the widows.
- Get return on investment impact selling chips, so profits outweigh the profits will be distributed to the holder.
- The important point is to use other people's money without their involvement in management.
Types of Premium Shares:
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Premium Shares Participation:
This means that these stocks take their share of profits first and then take a share after dividends on uncommon stock. If it is not participating, they take first share only.
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Collected premium shares:
Premium shares do not receive profits unless in case the company has made profits. The company announces the dividends of profits after achieving them. If the company achieved profits and did not announce its dividends in the year, and in case of these shares are stock-premium profits and in the next year the company announced the distribution of dividends carried out these shares do not lose the right to participate in the earnings related to the previous. In the event that such shares are unencumbered, they lose the right to participate in the profits of past years, but only in the year in which they decide to distribute dividends.
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Convertible Premium Shares:
This means it is convertible into common stock, and that's of course if he sues the Company Act, in the case of booming businesses, the common shares be better than blue chips, this campaign can chips that convert to common stock, if the company law.
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Guaranteed Premium Shares Profits:
In this case, the Premium Shares take their share of the profits or the proceeds, so that they are predetermined and even if the Company has not made profits, Nominal value.
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Bonds:
A bond is a share in a loan taken by the issuing company from the persons and institutions from which the bonds are purchased. Bond issuance is a form of borrowing when the government or large companies borrow from the public. They sell the securities at a nominal value at a certain interest rate and mature in a specific time period. Interest rates are either annual or semi-annual, any utility be cyclical, and after the expiry of the specified time period, the issuers of these bonds return them and pay the nominal value of the holder.
We conclude from the definition that the bonds are:
- Which its author acknowledges her debt to the person who owned the amount equal to the nominal Division written authority.
- The exporter undertakes to pay annual or biannual benefits to the bondholder.
- The exporter undertakes to extinguish the bonds at maturity at face value.
Bond Forms:
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Terms of warranty:
- Guaranteed bonds demonstrated specific assets.
- Non-guaranteed bonds proved certain assets of first class.
- Non-guaranteed bonds demonstrated specific assets. The number of pay off all the bonds guaranteed by a mortgage or unsecured repays these bonds.
- Income bonds, which oblige the issuer to pay interest only when profits are made.
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In terms of interest rate:
- Fixed interest rate bonds.
- Bonds with floating interest rate
- Attractive interest rate bonds sold at a discount.
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In terms of the bearer:
- Bearer.
- Carry the bearer's name.
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In terms of convertibility:
- Bonds convertible into common stock after a certain period.
- Non-convertible bonds.
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In terms of usability for the call:
This means that the issuing company for the bond call bondholders (if the law or contract so provides, of course), to buy them or retrieved for a bonus call, whenever the arraignment was postponed less than premium.