Shares_1889

This extract from the book”Investing in stocks and shares” by John White tell us about several financial definitions trying to provide information about investing.

Firstly explains that a share gives the investor a proportion of it´s company´s dividend and also the right to vote in the annual general meeting.

Secondly, assets are everything of value a company owns; cash, property (lands, buildings…) and raw material less its liabilities.
Usually shares have a nominal value that represents the assets value of the company, if a share has a nominal value of 25p; it is sold in the market at a higher price.
There is also another type of shares, non-voting shares, which are disappearing because the owner of it can not vote on the company`s strategy
The dividends are the payments made by a company to the shareholder members, is the part of the profit given to the investors.

The P/E ratio represents how many years of earning per share would be needed to pay a share.

Finally the yield is the net percentage of the share price. In each country yields are usually lower than the interest of local bonds, and seem to be safer.

Mark = 5

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