Tuesday, January 19, 2010

Know Share

Small fragments

Please note, in the business world not only stores that can provide benefits. Other businesses that do not form too many stores that can provide benefits. Business usually is in the form of business entity, or popular terms: the company. Same with shops, corporate ownership can also be purchased. So you can choose which companies about always profitable in the past year, and you can buy a property (capital) of the company.

Different from the store, the capital of a company is generally much larger than the capital of a store. For example, the capital of the store you want to buy may be USD 30 million, but the capital of the company you want to buy can be reached USD 300 million.

The problem is, not everyone has cash USD 300 million. Maybe people just have a USD 3 million, so this means he only got possession of one percent of the value of the company's ownership. But how could so he could buy a property that only one percent of it?

By law, arranged in a way: the company's ownership is divided into small fragments, called the stock. For example, ownership of a company valued at USD 300 million was divided into shares which rated the stock a say USD 1,000. Thus, if you only have USD 3 million, then you can only buy 3000 shares.

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