Lauren Hua
There are various types of shares listed on the ASX. The most common are ordinary shares. However, there are also less common ones. Here are some of the different types of shares listed on the ASX and what they each mean. Ordinary Shares: These are the most common security traded on the ASX. A share is a portion of ownership in a company. Owners of ordinary shares are entitled voting rights so they can vote on significant decisions such as …
Fundamental and technical characteristics are important when examining stocks. However, here are an extra 9 factors to consider when selecting a stock. Ownership: When executives of a company own a large portion of shares in a company, shareholders can see that there is a vested interest with the executives of the company to do well. It is also worth looking at whether the executive compensation is dependent on the performance of the business they are running. Growing Industries: Look for …
Stocks on the Australian share market are categorised by their market capitalisation – small, mid, or large cap. This is calculated by multiplying the company’s current share price by the total amount of shares on issue. Small, mid and large cap stocks perform best in different economic environments. Large Cap A large cap stock is classified as a company which has a market capitalisation of more than $10 billion. Large cap or blue-chip stocks are the largest companies on the …
Companies may need to raise capital and instead of borrowing, they can issue a share purchase plan or convertible securities. The benefit of these methods is that they do not take on more debt. However, the downside is that this can cause the stock to dilute. In this article we explain what a stock dilution is and the consequences when this occurs. Why do companies dilute their stock? Companies may issue share purchase plans to raise capital to fund a …
Companies wanting to raise capital can issue a product called convertible bonds. In this article we discuss how these products work. Why issue convertible bonds? Companies which are in the initial growth phase may find it hard to obtain financing from lenders due to a poor credit rating. They may issue convertible bonds to investors to raise funds for expansion or a new project. How do convertible bonds work? Convertible bond holders receive regular interest payments with a pre-agreed coupon …