Financial Education for Students – Types of Shares at a glance
Those who deal in shares soon notices that there are many different types of stocks. Quickly lose track.
Shares according to transferability, after the share capital and to the securities issued are divided. In addition, there are special forms.
View the transferability
It raises the question, are the rules by which the stock sold and resold, and who can make the secularized rights. The bearer shares: bearer shares are the normal form, which occurs most frequently in practice. The owner, the person who purchased the stock can take the rights lay claim. The stock is not, as with shares, fixed to a certain person, but can be sold freely. The transfer of ownership is done by agreement and transfer. Thus the bearer share is very good gradable.
Registered shares: shares are bound to a name. This stock form can be issued only to a particular person who is registered in the share register of the corporation. This complicates the tradability. If a stock is sold to another person, this is done by agreement, transfer and an endorsement. Under an endorsement refers to a written transfer notice, which stated the new owner, which in this case also called endorser writing.
The registered share: In principle, the Act restricted registered works just like the registered share, but with the difference that the corporation consent before transferring it to another person needs. The transfer requires so, as in the registered share, an endorsement plus the consent of the corporation. The corporation here has the advantage that it can control very well, to whom the shares are to be issued. The employee share: Employee shares are issued to employees of the corporation. Often this is done more cheaply.
Division according to the legal scope ascribed
Not all of share represented the same rights. Can be distinguished here. The common share: it is the normal form and represents the right to attend the General Meeting, which is where important decisions are made. The shareholder has one vote at the general meeting and the right to information. Likewise, the owner of a share of common stock will be involved in the net profit and receives shares of Ultraconservatives. The salvage value is the money that is left when the AG dissolves. The preferred stock: Here are the owner granted certain preferential rights. This can be for example a higher dividend, more share of liquidation proceeds. Therefore the owners of the shares but must waive his right to vote. Conclusion: It can not get co-decide, but benefits.
Division after division of the share capital
Since stocks are shares of capital stock of a corporation, the capital stock must be “dismembered”. From this fact, the following types of shares:
The nominal value share: The nominal value share a value is set. This value is called nominal or par value. All nominal values prove added back the capital. It should be noted that the nominal value be less than one euro and shall be not less.
The share: The share is determined no par value in advance, but the number of pieces. The share capital is divided by the number of pieces is here the value of each piece. It should be noted that this value is not the same as the nominal value. Shares have no par value.
A brief example will illustrate this: Suppose that a shareholder owns half of the shares of a public company, he owns 50 percent of the capital. He has a very high voice at the meeting. If the share capital increase, the share capital is suddenly smaller, and therefore the voting rights. Either one accepts the shareholder then the privilege to buy new shares corresponding to this right you would then call option. Are no options issued new shares can also be issued so that the percentage ratio of the shareholder remains.