Knowledge Base
Index Trading
Options Trading
Stock Market
|
Preferred and Common Stocks
Description: Common stocks, preferred stocks, QQQQ,
stock market, SPY, options trading, research, shares, market, dividend,,
holders, bond
Preferred Stocks
Preferred stocks are more like a fixed investment in a corporation, rather than an equity
interest. They have a started rate of dividend, which is payable only if the corporation's finances
permit.
Owner of preferred shares receive a fixed dividend (not always
guaranteed). They do not have voting rights at annual meetings or on company matters. If the
company is wound up preferred shareholders have a claim, up to a fixed amount, over assets after
creditors (including holders of bonds) have been paid. This claim takes precedence over those of
common shareholders.
Most traded preferred stocks are cumulative. When the dividend
is not paid it accumulates and must be paid in full before payment of dividends to holders of common
shares. If a preferred share is non-cumulative, omitted dividend do not have to be paid. Dividend
payments do not guaranteed.
There are other types of preferred shares:
- Retractable Shares
- Participating Shares
- Variable Rates Shares
- Redeemable Shares
- Convertible Shares
Common Stocks
Common stocks represent a degree of ownership in the
corporation. They may vote on questions affecting the corporation
in proportion to the number of shares held. Common shareholders
have rights to elect the directors of the corporation. However, some
common stocks have limited voting rights, or no voting rights at all.
No matter which type of common shares is owned, the investor may
still profit from an increase in stock prices or through dividends.
Most stock traders are based on the expectation that the purchased stock
will rise in price, and the investor's profit will be the
difference between price paid and price sold.
Stock Market Research
Why is Stock Market Research Important?
Stock Research is important part of the Technical
Analysis of the stock or Fundamental Analysis of the Stock depending on
what type of market research you are involved in. The Stock Research has
to be done to predict the future trends of the stock, to built market
timing system or asses the real value condition of the company.
Market Stock Research General:
Before starting your market research company ,
determine whether the company is publicly held (traded on a stock
exchange), privately owned, or a subsidiary of a publicly held
organization. You will be much more successful in obtaining information
on publicly held companies. Public companies must report certain
financial information to the Securities and Exchange Commission
(SEC) and their shareholders. Also, serious investors use the Internet
to research potential stock purchases or monitor companies in
their portfolios. As a result, the Internet provides much more
information on public corporations than on private companies.
The first step in "research stock" is to identify the
stock exchange ticker symbol for the company of interest. It can be found at
After finding a ticket symbol for the company you
should know on what Exchange stock is trading, to what industrial group
(ETF) it belongs is an important part of company research. The
according Exchange Research and Index Research (ETF) have to be done as well.
When you are doing stock research (company research)
you should consider what price and volume movement did your stock
experience in the past two months, or three months, or six months, or
YTD (year to date) and up to 10 years? Understanding price and
volume movement is one of many concepts that will enable you to
hold on to your equities (stocks or stock mutual funds), long term.
Some Tips of the Stock Research Company:
There are some some of the facts to look at to
properly evaluate your stock to do your Stock Analysis?
- Price to Earnings Ratio
- Does the company have earnings?
- Increasing revenues and profits yearly?
- Stock split history?
- Is the company paying dividends?
- Future plans of the company
- Past and Current news on the company?
- Company graph of price and volume over time
The company ranking in its industry
Five Steps of Market Research
Market Research can be divided in several separate steps.
- First of all you have to get the basic
knowledge about market, exchanges, stocks, indexes, ETF,
shares, options, futures etc.
- Second step of market research demands you
to define a subject of research, your target. During this period
you have to answer on the following questions: what type
of trader you are and what you are trading.
- On the third step of Market research you have
to define relationships. If you are trading on the stock market,
you should know to what industrial group ( ETF ) this
stock belongs, on what exchange it is traded etc. Other words
doing stock research you have to support it with according index
and exchange researches too.
- The forth step is one where you are
collecting information such as historical price and volume,
etc. Real time quotes of price and volume, real time charts are
always the most important part of any type of market research
ether it stock research, stock market option research, research
index or trend research.
- The last step demands you to analyze all data
gathered during your market research and make conclusion
either it prediction of trend movement or assessing real value
of company ( stock ).
| |