1.1.6 Equities

This topic describes the equities.

Buying equities of any company/corporation lead to investors becoming owners of the corporation. As a shareholder, investor has certain basic rights.

• A claim, proportional to the number of shares held, to a portion of the corporation’s assets
• The power to vote on company business at shareholders’ meetings, again in proportion to shares held
• The right to dividends that may be voted by the Board of Directors
• Sometimes, a pre-emptive right to purchase new shares before they are offered to the general public.

The liability of the investor/shareholder is limited to the proportion of the holdings of the investor in the corporation.