Differences between shares, participations and preferred

In economics, it is common to talk about stocks and shares, especially when it comes to the stock market, markets and large companies, the situation is measured, very often according to how shares are bought and sold and participations. But what do these terms really refer to?

What are shares in Economics?

The shares in a company are the parts into which its initial capital is divided, and they serve to obtain capital quickly. Actions allow you to have vote decisive on important actions of the company. And ultimately, the actions of a company, indicate the power that the owner has over a company, this power is indicated in percentage, so that if you have a share of a company that has a total of 100 shares, it will be said that you have 1% of the business. Actions give Benefits to their holders based on the profits of the company, but also, for the sale of shares at a higher price than the purchase price, and for dividends.

What are participations in Economy?

Shares, unlike stocks

, they do not have the right to vote, nor decision-making power over the company, and the annual remuneration for the shares will be fixedregardless of whether the company grows or diminishes its power. The units are usually subject to other conditions, such as the fact that they are perpetual, Although in some cases, the sale can be negotiated after some time since the possession of the participations.

What are the preferred in Economics?

The preferred ones can be shares or participations with “preferential” conditions, since in case of bankruptcy of the company, the shareholders or owners of preferred shares, will receive the assets before the rest of the shareholders. The preferred ones do not have the right to vote, nor decision power in the company, and in most cases, they receive an annual fixed on the profits of the company.

The price of the shares, and therefore the value of shares and preferences, is marked by the situation internal company, by the situation of the country in which the company is headquartered, and by factors of the Economy.