A share is your chance to own a piece of the ‘big time’

Fsp Invest, 13 Nov. 2013

Tags: share, what is a share, johannesburg stock exchange, jse, public companies, public company, listed companies, south africa,

If you’re eager to start investing, before you go any further you need to know exactly what a share is. A share is a fundamental building block of the stock market. But why are there shares? Read on to uncover exactly what a share is…

A share is a portion of a company, Gareth Stokes in Fear, Greed and the Stock Market explains...

You can buy or sell a share on a stock exchange, or by other agreement. Each share gives proportional voting rights on its holder. And it entitles the holder to a proportional share in the profits of a company.

So that’s exactly what a share is. You also need to know how a share comes into existence.

Let’s have a closer look at companies in South Africa…

When it comes to shares and stock markets, you’ll mostly be concerned with public companies. These are the type of company that will often raise capital by inviting the public (such as you) to subscribe for shares...

They’re not limited to a maximum number of shareholders – but must have at least seven!

The Johannesburg Stock Exchange is home to public companies in South Africa

In South Africa, these public companies list on the Johannesburg Stock Exchange (JSE). These companies can have millions upon millions of shares (and shareholders).

To give you an idea, think about SABMiller. At time of writing this South African company had 1.67 billion shares in issue!

As a private investor you can buy and sell shares in public companies listed on the Johannesburg Stock Exchange through a stockbroker.

Once you buy shares, you become a part owner of that company you bought shares in.

So there you have it, exactly what a share is.

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