What is a Stock?
Share Certificate
The possession of a share is the proof of ownership of a company. A shareholder owns an equal part of the company's profits and all assets. A shareholder has rights to profits and ownership of assets. A shareholder holds an important place in the company.
Let's go further and learn who is a shareholder and what does going public mean and what does issuing shares to the mean and how you can purchase a share of a company.
Start of a business
For eg.
Mr. Mehta has an idea of starting a business of cooking and selling homemade snacks. He plans to cook them at home with the help of his wife. He foresees huge growth in his business and expects to generate good profits in the short term. He plans to sell them by the name of ‘Craker snacks’.
He starts off with making snacks at home and offering retailers and vendors to sell them at their shops at cheap rates so as to make it easy to sell. He maintains a small profit marginof 10% which makes it easy to penetrate the market.
Business runs good and his snacks are in demand. He makes a good amount of money even with smaller margins. This means that if he sells snacks worth Rs.100 then he would be making a profit of Rs.10 and the remaining would account for the cost incurred in producing the snacks.
Patrick Abboud
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