26. Process of Issuing Shares

26. Process of Issuing Shares

1. Prospectus : A document shared to the public providing details about the business

2. When a PLC issues share for the 1st time it is called "The INITIAL PUBLIC OFFERING"

3. PLC : Can sell shares to the others

   • No permission required unlike PVT LTD

4. Function of Stock exchanges

   • Set the price of shares
   • Protection for investors
   • Reflect the health of the economy
   • Provide scope for speculation

5. SPECULATION : Speculators make short term gains by buying shares when prices are low and selling it when high

6. Yield : size of financial return

   • (Dividend per share / Price per share ) * 100