Экз темы / business tipics / 15 Stock Market

STOCK MARKET

A company may raise money on the stock market or stock exchange (a market place for buying and selling shares).

It can issue shares (US stocks), or units of its capital, to institutional investors or the general public. Different types of shares or equities are available, but the most common are known as ordinary or common shares (US common stocks). When an investor buys a share, using the services of a specialist company or broker, he or she becomes a shareholder (US stockholder) and owns a part of (or has a stake in) a company. Shareholders can make money by receiving dividends, paid as a proportion of a company's annual profits, and when the value of their shares increases.

A company can also borrow money from investors by issuing bonds, loans for fixed periods with fixed interest rates.

Securities refer to both shares and bonds. Each year billions of shares and bonds are sold or traded on the world's major stock exchanges.

Many companies are authorized to use the stock exchange to trade their shares. Every day, the press gives prices and other information about the shares of the listed companies. Many newspapers have a financial section which includes information about the share prices of listed companies. This information enables people to follow the progress of any share the he or she owns or may be thinking of buying.

If you decide to invest a part of your savings on the stock market you can contact a broker for further advice about how to do this, and a broker recommends you a selection of companies' shares the you might be interested in buying. He also explains how these companies have performed in the past and how much you can expect to receive in dividends . The broker tells you how the transaction will be carried out and lets you know how much commission you will have to pay for the service. Once you agree to the terms, the broker contacts his representative on the stock exchange, who arranges the transaction. At the end of the day the transaction usually is completed and you becomes a shareholder.

Every day more and more people take an interest in the stock exchange, because they realize that they must take responsibility for their own financial future. Therefore they must think carefully about their savings and find a way to gain the maximum return on their money. This is the main reason but besides the easy excess to the internet resources gives the chances to more and more people to log on as many times as they want.