ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The term ‘shareholder’ is used to denote any person, institution or company that has ownership of at least one share of a company’s stocks, also referred to as equity. Also known as stockholders, such entities are partial owners of a company and are entitled to a share in the profits that the said company generates.

Detailed explanation-2: -Shareholders, or stockholders, are the owners of a company’s outstanding shares, which represents a residual portion of the corporation’s assets and earnings as well as a percentage of the company’s voting power.

Detailed explanation-3: -A share is a piece of a company limited by shares. Each piece represents a certain percentage of the company. Anyone who owns shares in a limited company is called a ‘shareholder’ or ‘member’. The number of shares held by each member determines how much of the company they own and control.

Detailed explanation-4: -The owners of a corporation are called “shareholders.” The persons who manage the business and affairs of a corporation are called “directors.” However, state corporate law does provide for shareholders to enter into shareholders’ agreements to eliminate the directors and provide for shareholder management.

Detailed explanation-5: -So, are shareholders and investors the same? No. Although the differences are quite subtle; a shareholder is an entity owner of a company when it is possible to buy and hold shares, whereas an investor is someone that puts money into a business that does not have shares issued.