Monday, 14 February 2022 01:36

How can your company invest in stocks?

Written by Evelyn Alas

Shares are securities representing the capital stock of a corporation. Their value can increase or decrease depending on economic factors of both the company and the country in general.

Whoever buys a share becomes the owner of a part of that company and acquires rights over it. When a company decides to enter the stock market, it issues new shares and offers them to the investing public.

The process consists of presenting a business plan, the company's audited financial statements and the use it will make of the resources it obtains from these new shares.

Investing in a stock is not an easy task and that is why different types of analysis must be taken into account: macroeconomic, microeconomic and technical.

Some types of shares that can be issued are:

Ordinary: They give the right to vote in ordinary and extraordinary meetings and also give the right to receive the company's profits. These shares do not grant any privilege or preference to the parties and do not have a stipulated expiration date.

Preferred or limited voting shares: In these, shareholders only have the right to vote in certain circumstances, but are granted preference in the payment of dividends.

Enjoyment shares: These are shares that do not represent the capital stock, but establish some type of benefits on profits or earnings.

Privileged: These are shares with a preference or advantage with respect to the distribution of profits or some other benefit.