Stocks Essay Example | Topics and Well Written Essays - 1000 words

neckcloths - Essay Example(Maunder 3rd Ed).However commonalty Shargonholders are entitled to rights of pre-emption in the event of the company decision of offering more stock. favored StockPreferred Stock pertains to the philosophy of hybrid security, that is where there is a payment of a fixed dividend to its owners and this dividend does not fluctuate(it does not have to be paid this dividend if. Preferred stock can be either Cumulative( that is giving its owners the right to accumulate dividend payments missed before),Non-Cumulative (where no payment is make available for skipped dividends),Participating(stock with a higher rate of dividend) and Convertible(to shares).Trading in stocks is carried out at the stock change over, by individual investors and overreach fund traders. However trading in stocks is no longer limited to the interaction at the Stock Exchange and stocks are also auctioned at the open stock rally through Open hollo and share purchases can also be made on line.An example of the physical/conventional stock exchange model is New York Stock Exchange which is a listed exchange.How are stocks traded on a listed exchangeOrders for the purchase of stock are entered through the exchange members and go on to the specialists Once a purchase has been made the specialist testament close the difference taking into amount the time considerations.The details of the trade are recorded and sent back to the relevant brokerage firm.The modern day physical stock exchange is also highly computerised.An example of virtual listed exchange is NASDAQ which includes trading only over the computer and the traders will be matched through the computer system. Another example of an electronic stock exchange is the The Paris Bourse. wherefore are stocks and stock markets an integral part of the EconomySignificant source of funding for large companies in a public way as stocks present a fairly liquid investment choice un standardised investment in property etc.Ri sing stock prices indicate a roaring economy and good business investment.Stock prices are on the top agenda of financial regulators like the state/central bank as any unusual variation in these prices will adversely affect the health of the economy.Therefore the smooth exchange of stocks and shares facilitates entrepreneurial supremacy and long term success in an economy.Currently there is an increased trend of investing in stocks rather than government base securities like bonds etc in the developed economic systems like