BUYING STOCKS ONLINE!! Shares of Stock Represent Pieces of Ownership in a Business Imagine you wanted to start a retail store with members of your family. You decide you need $100,000 to get the business off the ground so you then in corporate a new company. You divide the company into 1,000 pieces, or ’shares’ of stock. (They are called shares because each piece of stock is entitled to a proportional share of the profit or loss). You price each new share of stock at $100. If you can sell all of the shares to your family members, you should have the $100,000 you need (1,000 shares x $100 contributed capital per share = $100,000 cash raised for the company). earnings per share (or EPS as it is often called on Wall Street). You could call a meeting of the company’s Board of Directors - the people the stockholders elected to watch over their interest since they couldn’t run the business - and decide to use the money to pay cash dividends, repurchase stock, or expand the company by reinvesting in the retail store. In an online means, you can sell your shares to other users, and get back your investment with profit.
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