Shares Overview

What are the two main types of shares?

• Common shares and preferred shares

• Primary shares and Secondary shares

• A shares and B shares

• Regular shares and Elite shares

How do common shares differ from preferred shares?

• Preferred shares have voting rights, while common shares do not.

• Common shares have voting rights, while preferred shares do not.

• Common shares offer fixed dividends, while preferred shares do not.

• Preferred shares have higher liquidity than common shares.

Name one benefit of owning shares in a company.

• Receive dividends

• Guaranteed return on investment

• Voting rights in company decisions

• Access to company facilities

What is a dividend and why is it important for shareholders?

• A dividend is a tax imposed on shareholders, reducing their overall return on investment.

• A dividend is a fee charged to shareholders for holding shares in a company, discouraging long-term investment.

• A dividend is a type of stock option that shareholders can exercise to increase their ownership in the company.

• A dividend is a distribution of a portion of a company's earnings to its shareholders, providing them with a return on their investment and indicating the financial health of the company.

Explain what capital gains are in relation to shares.

• Capital gains are unrelated to the stock market.

• Capital gains are losses incurred from selling shares at a lower price than the purchase price.

• Capital gains are dividends received from shares.

• Capital gains in relation to shares are the profits made from selling shares at a higher price than the purchase price.

What is the risk associated with investing in shares?

• Interest rates, political stability, currency exchange rates

• Market volatility, company performance, economic factors, potential loss of capital

How can owning shares help investors grow their wealth?

• By winning a lottery

• By benefiting from the company's growth and profitability through capital appreciation and dividends.

• By hiding money under the mattress

• By avoiding all financial investments

What is the difference between voting and non-voting shares?

• Voting shares can be traded publicly, non-voting shares cannot.

• Voting shares have voting rights, non-voting shares do not.

• Voting shares have no ownership rights, non-voting shares do.

• Voting shares have higher value than non-voting shares.

Why do companies issue shares to the public?

• To raise capital and diversify ownership.

• To make employees feel included in the decision-making process.

• To limit the company's growth potential.

• To decrease the company's market value.

What role does the stock market play in buying and selling shares?

• Manages the weather forecast

• Facilitates the buying and selling of shares through brokers on the stock exchange.

• Sells ice cream on weekends

• Coordinates international diplomacy