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Equity shares
SUBJECT : Financial Management
AUTHOR : Mohammed Arif pasha
PUBLISHED ON : 19/12/17
NUMBER OF PAGES : ( 7 Pages)
PRICE : Rs 4.2

Equity shares represent an ownership position in a corporation. It a residual claim, in the sense that creditors and preference shareholders must be paid before shareholders can receive any payment. In the event of liquidation, equity shareholders are entitled to assets remaining only after all prior claimants have been satisfied. Thus the risk is highest with equity shares and so must be its expected return. When investors buy equity shares, they receive certificates of ownership as proof of their being part owners of the company which states the number of shares purchased and their value. As a unit of ownership, equity shares typically carries voting rights that can be exercised in corporate decisions. Preferred stock differs from common stock in that it typically does not carry voting rights but is legally entitled to receive a certain level of dividend payments before any dividends can be issued to other shareholders.