In case of proactive investing, Equity share or investing is supposed to be the main point to consider. Everything that has to be associated with equity investing like IPO, company’s shares to dividends and more, all will be proficiently discussed with great enthusiasms. The available equity shares will be considered the major asset class and will play one significant role in the field of asset diversification of the portfolio of the investor. For those belonging to the younger generation, equity share can also be the ones that their parents warmed about. But, before you head towards any of the point, be sure to understand the types first.
Go for the preference shares:
Once you are sure of the equity shares meaning, it is time to head towards the types. Preference shares will be one such example that generally differs from the regular equity shares. Such shares will pay a fixed dividend rate to holder, annually for the tenure length, expect when the company runs down in a loss. The preference shareholders are just above those of the ordinary ones when it is time for distributing the dividend. It is because they are firstly paid before the regular shareholders. Moreover, they will receive priority just over the regular shareholders in case the company is actually liquidating.
DVR shares and more:
Another example when talking about the types of equity shares has to be differential voting rights or the DVR shares. DVR share will allow you with either more or less form of voting rights a share than the common form of equity share. Some countries have allowed DVR for a long time with less voting rights when compared to regular shareholders. Other than these options, the world of equity investment also has ESOP or Employee Stock Option Plan and Sweat Equity as some of the other options.