Stocks are not equal
Not all stocks are equal. There are several different types of stocks. When seeking investment, it is necessary for you to have a complete view. Before you can make an informed investment decision, you need to know the terms of the definition of shares.
Authorized Shares Represents the total number of shares authorized at the time of creation. The number of shares can only be increased through shareholder voting. While stocks are authorized, this does not mean that they are all distributed to the public.
Some companies will retain their shares for future use. These are known as treasury stocks .
Restricted Stock is the stock of the company for employee incentive and compensation programs. Restricted Shareholders are required to obtain permission from the SEC to sell their shares. After the company's initial public offering, there is a waiting period, in which the restricted shares of insiders are frozen.
Floating Equity is the number of stock markets that are actually open for trading, regardless of the size of the company.
Anyone can buy these stocks. Issued Shares All shares issued by the Company, including restricted and floating shares.
For example, if the company authorizes 100 shares. They hold 20 shares as treasury shares. The company has 10 shares of restricted stock. The float is 70 (100-20-10 = 70). The balance is 80 (10 + 70 = 80)
When you see the relationship between treasury stocks and restricted stocks to outstanding stocks, you see a controlling stake in the company. Many companies retain a large number of authorized shares in treasury and restricted stocks
By doing so, they ensure that they can not be taken over by another company.
If a company's liquidity is small, but the stock attracts a lot of investors, then this stock tends to become unstable, because the imbalance between the supply of companies And demand.
By looking at a limited number of shareholders, you can get a lot of information about a company. Stocks will rise, become overvalued, and then fall rapidly in many cases. You can visit insider trading sites to let you know insiders and major shareholder programs or recent sales.
By understanding the various types of stocks, you will gain a better understanding of the company itself. All stocks are not equal. Make sure you know where to control the company. It can tell you where many companies are. By understanding the stock, you find that you are ready to analyze the company