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The Stock Market
What is a Stock? Name used to describe money raised by a joint stock  company or corporation, or a government.
Who Owns the Company? Shareholders: any person or organization that buy and  hold shares in a joint stock company.
What is       Market Capitalization? The market value of all shares or equity issued by a  company.
Why Buy Stocks? As an investment, hoping stock prices will rise over  time. Shareholders are entitled to a share of any ...
Permanent Capital Money raised from the issue and sale of shares is NOT  a loan. Shareholders have to sell their shares ...
Where to Buy/ Sell Shares? New York Stock Exchange (NYSE) National Association of Securities Dealers Automated  Quotatio...
What is a Floatation? Involves a new company issuing shares for the first  time for sale through a stock exchange.
What is a Bond? Governments can raise money to finance public  expenditure through the sale of government loan  stocks or...
Functions of a             Stock Exchange A business organization that enables  individuals, companies and governments to...
Functions of a             Stock Exchange It brings together buyers and sellers of new and  second-hand stocks. It provi...
Functions of a              Stock Exchange Most trading in stocks and shares is now conducted  electronically. The NASDA...
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G910 econ

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G910 econ

  1. 1. The Stock Market
  2. 2. What is a Stock? Name used to describe money raised by a joint stock company or corporation, or a government.
  3. 3. Who Owns the Company? Shareholders: any person or organization that buy and hold shares in a joint stock company.
  4. 4. What is Market Capitalization? The market value of all shares or equity issued by a company.
  5. 5. Why Buy Stocks? As an investment, hoping stock prices will rise over time. Shareholders are entitled to a share of any profits made by the companies they own. The profit is called a dividend. The more shares a stockholder holds, the more dividend he/ she receives.
  6. 6. Permanent Capital Money raised from the issue and sale of shares is NOT a loan. Shareholders have to sell their shares to get their money back.
  7. 7. Where to Buy/ Sell Shares? New York Stock Exchange (NYSE) National Association of Securities Dealers Automated Quotations (NASDAQ) Tokyo Stock Exchange London Stock Exchange Shanghai Stock Exchange Hong Kong Stock Exchange  Major stock exchanges: as at 31 December 2011
  8. 8. What is a Floatation? Involves a new company issuing shares for the first time for sale through a stock exchange.
  9. 9. What is a Bond? Governments can raise money to finance public expenditure through the sale of government loan stocks or bonds.
  10. 10. Functions of a Stock Exchange A business organization that enables individuals, companies and governments to buy and sell shares on the global stock market. Most important source of finance for most companies.
  11. 11. Functions of a Stock Exchange It brings together buyers and sellers of new and second-hand stocks. It provides up to the minute information on the market prices of different stocks and quantities traded. It supervises the conduct of firms of brokers that buy and sell shares on behalf of investors.
  12. 12. Functions of a Stock Exchange Most trading in stocks and shares is now conducted electronically. The NASDAQ was the first electronic stock exchange, founded in 1971. http://www.nasdaq.com

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