Equity

A property security representing a share in a joint-stock company associated with the rights of the shareholder as a partner to participate in the management of a joint-stock company and its profit and in liquidation surplus in the case of dissolution of the company. It allows two kinds of yield – the dividend (or share in the profits of the company) and exchange rate (capital) yield resulting from the favourable movement of share prices. Neither the dividend nor the exchange rate yield is guaranteed in advance. The rates of shares may fluctuate significantly, for example, under the influence of different stages of the economic cycle or the success rate of the company’s management.