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How It's Made - Shares!
Today, let's talk about how shares come into existence!
It isn't quite as exciting as how we're made!
But I'm SURE you'll be able to learn something!
First, let's talk about where shares come from!
Today, let's talk about how shares come into existence!
It isn't quite as exciting as how we're made!
But I'm SURE you'll be able to learn something!
First, let's talk about where shares come from!
When a company decides it wants to raise money by issuing shares to the public, it will do what is called an 'Initial Public Offering' or IPO.
This can also be called 'coming to market!'
These shares can be new ones created by the company, or sold by existing owners for profit.
This can also be called 'coming to market!'
These shares can be new ones created by the company, or sold by existing owners for profit.
When the shares the company creates are sold, the company receive the proceeds.
If an existing investor sells their shares, the cash goes to them!
Sound familiar?
It's called the STOCK MARKET! or the 'secondary' market! The shares listed here are called second hand shares.
If an existing investor sells their shares, the cash goes to them!
Sound familiar?
It's called the STOCK MARKET! or the 'secondary' market! The shares listed here are called second hand shares.
You've probably done this before!
While the primary market is the creation and sale of new shares, most of the time you will be buying second hand shares!
These investors aren't just like you or I!
They are called 'Instititional Investors!' Pension funds are one example.
While the primary market is the creation and sale of new shares, most of the time you will be buying second hand shares!
These investors aren't just like you or I!
They are called 'Instititional Investors!' Pension funds are one example.
Shares can also be created through stock options, rights issues, placings, bonus issues and share splits!
Sometimes, a company may buy its own shares in the hope of reissuing them at a higher price!
These are known as treasury shares.
Sometimes, a company may buy its own shares in the hope of reissuing them at a higher price!
These are known as treasury shares.
That's a little bit about how shares are made! If you have learnt anything or want me to clarify anything leave a comment!
Thank you for learning!
Sensei.
Thank you for learning!
Sensei.
