Shares Flashcards
1
Q
How do shareholders get their rewards?
A
Dividends -
Payments made to shareholders by the company from earned profits
Normally no requirement to pay dividends, but most quoted companies do
2
Q
What’s another way shareholders get their rewards?
A
Capital Growth (aka. Capital gain)
Arises from an increase in the value of business
Reflected in an increase in a share price
3
Q
How do you determine a share price
A
Determined by the interaction of supply and demand
4
Q
How does the price of a share change?
A
If the demand for a share > the amount of shares, the share price will go up
If it’s the other way round, share prices will fall
