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Ordinary shares |
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Ordinary sharesCompanies are incorporated with an authorised share capital - for instance 1,000 ordinary £1 shares. They do not have to issue all the authorised shares, but can issue as many as they like up to the authorised number.Once issued the shares can be traded either privately or on an exchange if the company has listed them. The price at which they trade will have nothing to do with the par value, but will be determined by market forces. Broadly speaking, if there are more willing buyers than sellers, the price will rise; if there are more sellers than buyers, it will fall.Shares usually come with a right to vote at the company's Annual General Meeting, and an entitlement to a share of dividends declared. They are, however, unsecured. This means that shareholders are last in the queue if a company goes bust and has to sell off its assets. If the amount realised is enough to pay off all creditors, the shareholders may salvage something. If it isn't, the shares will be worthless.Ordinary sharesApples mainly to international equities. Shares of non-U.S. companies traded in their individual home markets. Usually cannot be delivered in the US See: ADR.Ordinary shares Similar MatchesExtraordinary positive valueExtraordinary positive valueA positive net present value. Ordinary interestOrdinary interestInterest based on a 360-day year instead of a 365-day year, resulting in what can be a significant difference. Ordinary tradeOrdinary tradeA term used by the London Stock Exchange to denote that a transaction does not have any other special trade designation. Extraordinary itemsExtraordinary itemsCosts which affect a company's profit (or loss) which are not associated with normal activities and which are not expected to recur. Extraordinary general meetingExtraordinary general meetingAn EGM is a special meeting of a company and its shareholders which can be called by company directors or anyone with at least 10% of the voting rights on the company's shares.EGMs have to be called in order for certain special resolutions to be passed (e.g. to approve a takeover or merger or break-up of the company) and for the resolution to be passed, 75% of more of the shareholders have to vote for it. Further SuggestionsOrdinary incomeFT Ordinary Share Index (FT 30 Index) Extraordinary call Extraordinary item |
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