Introductory Stock Basics (Section 1)

The stock market is vast and risky. If you want to enter the stock market, you must first know what stocks are, what they can bring to you, and the value and risk of investing in the stock market

Concept of stock

With the deepening of the reform of economic constitution, the stock market is also constantly developing and improving. The number of investors participating in the stock market investment is increasing. The stock market investment has become a financial means that people are willing to bear its risks, and stocks have naturally become a hot topic that everyone cares about.

1What is stock

The capital of a company limited by shares is divided into shares, and the amount of each share is equal. The shares of the Company take the form of shares. A share certificate is a certificate issued by the company certifying the shares held by shareholders. In other words, stock is the abbreviation of share certificate. It is a kind of valuable securities issued by a joint stock limited company to shareholders as shareholding certificates to obtain dividends or bonuses in order to raise funds. Each share represents the shareholder's ownership of a basic unit of the enterprise. Stock is a component of the capital of a joint-stock company, which can be transferred, traded or mortgaged. Stock is the main long-term credit instrument in the capital market.

2 What is a company limited by shares

A company limited by shares refers to a company whose capital is shares, and is an enterprise legal person whose shareholders are responsible for the company to the extent of the shares they subscribe for. To establish a joint stock limited company in China, there shall be at least five days as promoters, and more than half of the promoters shall have domicile in China. The minimum registered capital of a joint stock limited company is 10 million yuan. Since all joint stock companies must be limited companies with limited liability (but not all limited companies are joint stock companies), they are generally referred to as "joint stock limited companies".

Concept of shareholders

Shareholders are the investors or investors of joint-stock companies. A shareholder is a person who holds shares in a joint stock limited company or a limited liability company and has the right to attend and vote at the general meeting of shareholders. It also refers to investors in other joint venture industrial and commercial enterprises.

Shareholders are the basis for the existence of a company and the core element of the company. Shareholders are those who hold shares of the company or contribute to the company. Without shareholders, there can be no joint stock limited company.

Legal status of shareholders

  1. Relationship between shareholders and the Company

As investors, shareholders enjoy the rights of owners to share profits, make important decisions and choose managers. Unless otherwise agreed by the shareholders.

  1. Relationship between shareholders

All shareholders are equal in status. In principle, the same shares have the same rights and interests. However, the Articles of Association may make other provisions. A wholly state-owned company shall be entrusted by the State Council or the local people's government to the state-owned assets supervision and administration institution of the people's government at the same level to perform the functions of a contributor.

stockholder concept

Individual investors who engage in stock trading are called shareholders. The difference between shareholders and shareholders is that shareholders are relatively fixed, and shareholders have greater liquidity. However, such a situation often occurs in the stock market: after investors buy stocks, they are trapped, thus stopping frequent transactions, and investors become shareholders. Therefore, many people become shareholders because of stock speculation.