what is a stock?

Stock is a share certificate issued by a joint stock limited company to investors when raising capital. Stock represents the ownership of the joint-stock company by its holders (that is, shareholders). This kind of ownership is a comprehensive right, such as attending the shareholders' meeting, voting and participating in the company's major decisions. Receive dividends or share dividends, etc. Every stock in the same category represents equal ownership of the company. The share of ownership of the company owned by each shareholder depends on the proportion of the shares held by each shareholder in the total share capital of the company. Generally, stocks can be transferred with compensation by buying and selling, and shareholders can recover their investment through stock transfer, but they cannot ask the company to return their investment. The relationship between shareholders and the company is not a creditor-debtor relationship. Shareholders are the owners of the company, who are limited to the amount of their capital contribution, take risks and share the benefits.

Stock is the product of socialized mass production, with a history of nearly 4 years. As the fruits of human civilization, joint-stock system and stock are also applicable to China's socialist market economy. Enterprises can raise funds for production and operation by issuing shares to the public. The state can control more resources with the same funds by controlling the majority equity. Currently in Shanghai. Most of the companies listed on Shenzhen Stock Exchange are state holding companies.

stocks have the following basic characteristics:

(l) non-repayability. Stock is a kind of negotiable securities with a free repayment period. After investors subscribe for the stock, they can no longer ask for withdrawal, but can only sell it to a third party in the secondary market. The transfer of shares only means the change of the company's shareholders, and does not reduce the company's capital. As far as the term is concerned, as long as the company exists, the stocks it issues exist, and the term of the stocks is equal to the duration of the company.

(2) participation. Shareholders have the right to attend the shareholders' meeting, elect the board of directors of the company and participate in major decisions of the company. Shareholders' investment will and economic benefits are usually realized by exercising shareholders' participation rights.

the right of shareholders to participate in the company's decision-making depends on the number of shares they hold. In practice, as long as the number of shares held by shareholders reaches the actual majority needed to influence the decision-making results, they can master the company's decision-making control.

(3) profitability. Shareholders have the right to receive dividends or bonuses from the company by virtue of the shares they hold, and obtain the income from investment. The size of dividend or bonus mainly depends on the company's profit level and the company's profit distribution policy.

the profitability of stocks is also manifested in the fact that stock investors can obtain the price difference income or realize the preservation and appreciation of assets. By buying people at a low price and selling stocks at a high price, investors can earn a profit from the price difference. Take the stock of Coca-Cola Company in the United States as an example. If you invest $1, to buy the company's shares at the end of 1983, you can sell them at the market price of $11,554 by July 1994, earning more than 1 times the profit. During inflation, the stock price will rise with the replacement price of the original assets of the company, thus avoiding the depreciation of assets. Stocks are usually regarded as the preferred investment object during the period of high inflation.

(4) liquidity. The liquidity of stock refers to the tradeability of stock among different investors. Liquidity is usually measured by the number of shares that can be circulated, the trading volume of shares and the sensitivity of stock prices to trading volume. The more tradable shares, the greater the trading volume, the less sensitive the price is to the trading volume (the price will not change with the trading volume), the better the liquidity of the stock, and vice versa. The circulation of stocks enables investors to sell their stocks in the market and get cash. Through the circulation of stocks and the changes of stock prices, we can see people's judgments on the development prospects and profit potential of related industries and listed companies.

those industries and companies that attract a large number of investors in the circulation market and their share prices are rising continuously can continuously absorb a large amount of capital into production and business activities by issuing additional shares, which has achieved the effect of optimizing resource allocation.

(5) Price volatility and risk. As the trading object in the trading market, stocks, like commodities, have their own market quotation and price. Because the stock price is influenced by many factors, such as the company's operating conditions, the relationship between supply and demand, bank interest rates, public psychology and so on, its fluctuation has great uncertainty. It is this uncertainty that may make stock investors suffer losses. The greater the uncertainty of price fluctuation, the greater the investment risk. Therefore, stock is a high-risk financial product. For example, International Business Machines Corporation (IBM), which dominates the world computer industry, once had a share price as high as $17 when its performance was extraordinary. However, when its position was challenged and it incurred losses due to operational missteps, its share price fell to $4. If you buy the stock at a high price at an inappropriate time, it will lead to serious losses.

There are broad and narrow definitions of funds. In a broad sense, funds are the collective names of institutional investors, including trust and investment funds, unit trust funds, provident funds, insurance funds, retirement funds and funds of various foundations. Funds in the existing securities market, including closed-end funds and open-end funds, have the characteristics of income function and value-added potential. From the perspective of accounting, fund is a narrow concept, which means funds with specific purposes and uses. Because the investors of the government and institutions do not require investment returns and investment recovery, but require the funds to be used for designated purposes according to the law or the wishes of the investors, funds are formed.

The funds we are talking about now usually refer to securities investment funds.

securities investment fund is an indirect way of securities investment. By issuing fund units, fund management companies concentrate investors' funds, which are managed by fund custodians (that is, qualified banks), managed and used by fund managers to invest in financial instruments such as stocks and bonds, and then * * * bear the investment risks and share the benefits. According to different standards, securities investment funds can be divided into different types:

According to whether the fund unit can be increased or redeemed, it can be divided into open-end funds and closed-end funds. Open-end funds are not listed and traded, but are generally purchased and redeemed by banks, and the fund scale is not fixed; Closed-end funds have a fixed duration, during which the fund scale is fixed. Generally, they are listed and traded on the stock exchange, and investors buy and sell fund units through the secondary market.

Open-end fund

is a fund with variable issuance, and the total number of fund shares (units) can be increased or decreased at any time, and investors can purchase or redeem it at the business place designated by the fund manager according to the quotation of the fund. Compared with closed-end funds, open-end funds have the characteristics of unlimited issuance, trading price based on net asset value, over-the-counter trading and relatively low risk, and are especially suitable for small and medium-sized investors to invest.

The development history of world funds is the history from closed-end funds to open-end funds. Take the United States, the most mature fund market, as an example. In September 199, there were 3, open-end funds in the United States, with total assets of $1 trillion; There are only 25 closed-end funds with total assets of $6 billion. By 1996, the assets of open-end funds in the United States were US$ 3,539.2 billion, while the assets of closed-end funds were only US$ 128.5 billion, the ratio of the two reached 2.754 ∶ 1; In 194, the ratio was only .73∶1. In Japan, closed-end funds accounted for the vast majority before 199, and open-end funds were in a subordinate position; However, after 199s, the situation changed fundamentally, and the assets of open-end funds reached about twice that of closed-end funds.

In countries and regions with earlier Asian development investment funds, such as Hong Kong, Thailand, Taiwan Province, Singapore and the Philippines, closed-end funds dominated at the beginning of development, and gradually transitioned to the stage where the two types of funds coexist. From a global perspective, the net assets balance of the world's open-end investment funds was US$ 2,355.4 billion in 199, and it has jumped to US$ 5,34.7 billion in 1995.

Open-end funds have gradually become the mainstream of investment funds in the world.

most investment funds in the world are closed at the beginning. This is because in the early stage of the development of investment funds, the handling fee for buying and selling closed-end funds is far lower than that for redeeming the shares of open-end funds. From the perspective of fund management, because there is no pressure to request redemption of beneficiary certificates, investors' funds can be fully utilized to implement their investment strategies in order to maximize their benefits.

Closed-end funds

belong to trust funds, which refer to investment funds whose fund scale has been determined before issuance, fixed within the specified period after issuance and traded in the securities market.

Because closed-end funds are traded in the stock exchange by bidding, the transaction price is affected by the relationship between market supply and demand and does not necessarily reflect the net asset value of the fund, that is, the transaction price of closed-end funds is at a premium or discount compared with its net asset value. The practice of foreign closed-end funds shows that the transaction price often has the price fluctuation law of premium first and then discount. Judging from the operation of closed-end funds in China, no matter how the fundamental situation changes, the transaction price trend of closed-end funds in China has never been separated from the price fluctuation law of premium first and then discount.

According to different organizational forms, it can be divided into corporate funds and contractual funds. Funds are established by issuing fund shares to establish investment fund companies, which are usually called corporate funds; Fund managers, fund custodians and investors are established through fund contracts, which are usually called contractual funds. At present, China's securities investment funds are all contractual funds.

corporate fund

is also called * * * mutual fund, which means that the fund itself is a joint stock limited company, and the company raises funds by issuing shares or beneficiary certificates. When an investor buys the shares of the company, he becomes a shareholder of the company, receives dividends or dividends with the shares, and shares the income from the investment.

Features

1.*** The same fund is a joint-stock company, but it is different from ordinary joint-stock companies, and its business focuses on securities investment trusts.

2.*** The fund is the capital of the company as a legal person, that is, shares.

3.*** The structure of the fund is the same as that of a common joint-stock company, with a board of directors and a shareholders' meeting. Fund assets are owned by the company, and investors are the shareholders of this company and the ultimate holders of its assets. Shareholders exercise their rights at the shareholders' meeting according to the size of their shares.

4. according to the articles of association, the board of directors is responsible for the safe proliferation of fund assets. For the convenience of management, mutual funds often have fund managers and custodians. The fund manager is responsible for the investment management of the fund assets, and the custodian is responsible for the supervision of the fund manager's investment activities. The custodian may (not necessarily) open an account in the bank and register the fund assets in his own name. In order to clarify the rights and obligations of both parties, * * * has a contractual relationship with the fund company and the custodian, and the responsibilities of the custodian are specified in the "Custodian Agreement" signed by him and * * * with the fund company. If * * * has problems with the fund, investors have the right to directly ask * * * for it from the fund company.

Contractual fund

is also called unit trust fund, which refers to a fund management company established by a special investment institution (banks and enterprises). As a client, the fund management company issues a beneficiary certificate-"fund unit holding certificate" by signing a "trust deed" with the trustee to raise idle funds in the society.

Features

The unit trust is a manager company established by a document named trust deed. In organizational structure, it does not have a board of directors. The fund manager company sets up a fund as the entrusting company, and manages the operation and operation of the fund by itself or by hiring a manager again. Usually, a securities company or an underwriting company is appointed to handle the issuance, trading, transfer, trading, profit distribution, income and repayment and payment of principal and interest on behalf of the beneficiary certificate.

the trustee accepts the entrustment of the fund manager company and registers and opens an account for the fund in the name of the trustee or trust company. The fund account is completely independent of the account of the fund custodian company. Even if the fund custodian company goes bankrupt due to poor management, its creditors cannot use the assets of the fund. Its duties are to manage, keep and dispose of the trust property, supervise the investment work of fund managers, ensure that fund managers comply with the investment regulations listed in the prospectus, and make their investment portfolio meet the requirements of trust deed. When there is a problem with the unit trust fund, the trustee is responsible for claiming compensation from the investors.

According to the difference of investment risks and returns, it can be divided into growth funds, income funds and balanced funds.

according to different investment objects, it can be divided into stock funds, bond funds, money market funds and futures funds.

stock fund

is an investment fund with stocks as the investment object, and it is the main type of investment fund. The main function of stock funds is to concentrate the small investments of mass investors into large funds. Investing in different stock portfolios is the main institutional investor in the stock market.

classification

stock funds can be divided into preferred stock funds and common stock funds according to the investment objects, and preferred stock funds can obtain stable income. Less risk. Income distribution is mainly dividends; Common stock fund is the largest fund at present, which aims at pursuing capital gains and long-term capital appreciation, and the risk is greater than that of preferred stock fund. According to the degree of diversification of fund investment, stock funds can be divided into general common stock funds and specialized funds. The former refers to the diversification of fund assets into various common stocks, while the latter refers to the investment of fund assets in some special industry stocks, which is risky but may have better potential returns. According to the purpose of fund investment, stock funds can also be divided into capital appreciation funds, growth funds funds and income-based funds. The main purpose of capital appreciation fund investment is to pursue rapid capital growth, so as to bring capital appreciation. This kind of fund has high risks and high returns. It is risky for growth funds to invest in ordinary stocks that have growth potential and can bring income. Stock income funds invest in stocks issued by companies with stable development prospects, and pursue stable dividend distribution and capital gains. Such funds have little risk and low income.

characteristics

1. compared with other funds, the investment objects of stock funds are diversified, and the investment purposes are also diversified.

2. Compared with investors directly investing in the stock market, stock funds have diversified risks. Low cost and other characteristics. For ordinary investors, individual capital is limited after all, and it is difficult to reduce investment risks by diversifying investment types. But if you invest in stock funds, investors can not only share the benefits of all kinds of stocks, but also spread the risks among all kinds of stocks by investing in stock funds, which greatly reduces the investment risks. In addition, investors who invest in stock funds can also enjoy the relative advantages of large-scale investment in the fund, reduce investment costs, improve investment benefits and obtain the benefits of scale benefits.

3. from the perspective of asset liquidity, stock funds have the characteristics of strong liquidity and high liquidity. Equity funds invest in stocks with excellent liquidity, and their assets are of high quality and easy to realize.

4. For investors, the stock fund has stable operation and considerable income. Generally speaking, the risk of stock fund is lower than that of stock investment. So the income is relatively stable. Not only that, after the closed-end stock fund goes public, investors can also get the bid-ask difference by trading on the exchange. After the expiration of the fund, investors have the right to distribute the remaining assets.

5. Equity funds also have the right to stay in China.