Stock Market

Stock market is a market where the operations with securities (shares, bonds, promissory notes, bank certificates) are carried out; the price of the securities must be defined by assets behind them. Stock market serves money market as well as capital market. But securities serve only a part of financial resources movement (besides those there are intra- and inter-company loans, direct bank loans, etc.).

          Share is a lobar security which gives its holder a right to get a portion of net income from the joint-stock company's business in a form of dividends as well as a part of company's assets in case of its liquidation.

Shares can be of two categories: common and preferred.

Common shares give their holders a right not only to get a portion of the company's income but also to participate in the management of the joint-stock company. In this case one share means one vote at a shareholders' meeting.

Preferred shares allow their holders to get a portion of the income (usually larger than with common shares), but at the same time do not give them the right of a vote at a shareholders' meeting.

          Bond is a debt security which gives its owner (holder) a right to get from a bond issuer (legal entity that issues securities) in a pre-agreed period of time the nominal price of the bond in cash or as other property equivalent. Also a bond can mean a right for the holder to get a percent (coupon) from its nominal price or other property rights.

The bond income consists of the total amount of paid coupons and its price at the time of purchase.

Bonds are issued by the state (government bonds or Treasuries) as well as by transnational companies and corporations (corporate).

          Promissory note is a debt security, a written obligation in a very particular form. The person who issued the promissory note is called debtor. The person who owns the bill is a creditor. Promissory notes can be common or transferable.

Common promissory note is a maker's obligation to pay to the note holder the amount of money defined.

Transferable promissory note is an obligation of a note holder to pay with no condition the amount of money the maker requests in a written form. The procedure of a note holder accepting the obligation to pay on the transferable promissory note is called promissory note accept.

          Bank certificate is a registered security attesting the size of a bank deposit and the rights of a depositor (certificate holder) to get in the bank issued certificate or any bank branch after a specified period of time the deposited amount and specified in the certificate interest, or before the specified term – the deposited amount and the interest which paid on demand deposits, unless the certificate specifies something different. Bank certificates can be of two types: deposit and savings.

In case of a bank certificate of deposit, the depositor is a legal entity, in case of savings – individual.