What kinds of company shares are available for me to purchase?

Company Shares

Shares are the amounts invested in a company by its owners. Owners of a company in this manner will thus be shareholders.

If you wish to purchase shares in a company you are effectively purchasing stock in that company.

What are the categories of shares that are available?

Available shares can be broken down into the following categories:

  • Ordinary

  • Preference

  • Cumulative Preference

  • Redeemable

Ordinary

Ordinary shares are the most common standard company shares as they carry with them no special rights or restrictions.

Preference

Preference shares carry a right whereby any annual dividends that are available for distribution will be paid on these shares as a priority to before other types of shares.

Cumulative Preference

Cumulative preference shares carry a right whereby the dividend will be carried forward to successive years if it cannot be paid in an earlier year.

Redeemable Shares

Redeemable shares will be issued with an agreement that the company will buy then back at the option of the company or the shareholder either after a certain period of time or on a fixed date.

A company must have a mixture of the above shares, all with differing conditions attached to them, as it would be impossible for the proper running of the company just to have redeemable shares.

Will the shares that I purchase always be in the same currency?

Different types of shares for the same company may be in different currencies even if the company is formed in England and Wales.

Unlock this article now!

 

For more information on:

  • Do I have to purchase the shares directly from the company?
  • How do shares become transferred to new owners?
  • Public limited company
  • Private or unlimited company
  • How much stamp duty is required to be paid for the transfer of shares?
  • Can a company re-arrange its shares?
  • Can the rights which are attached to shares be changed?
  • Is it possible for a company to purchase its own shares?
  • If a company buys its own shares does it require a transfer document?