Powers of the shareholder?

[force]

Hi,

I am just starting in the stock markets and I would like to know what apart from voting rights does stock allow me to have over a business? Say for example I buy shares in a paper, does having shares in the paper business allow me to affect the way the paper is designed or what is said everyday etc? Without having to read books on law etc, can someone outline what exactly having shares enabled me to do in regards to control of the business?

 

[constable]

Hi,

I am just starting in the stock markets and I would like to know what apart from voting rights does stock allow me to have over a business? Say for example I buy shares in a paper, does having shares in the paper business allow me to affect the way the paper is designed or what is said everyday etc? Without having to read books on law etc, can someone outline what exactly having shares enabled me to do in regards to control of the business?

In regards to the day to day running of the company you wont have any say,
unless you have a substantial holding with substantial voting rights, then you can kick managements ass all over the place when they arent performing.
Apart from that you really have no control whatsoever.
Shareholders are also the last to receive any monies in the event of bankruptcy. (like thats going to ever happen! cough enron cough).
Basically a share entitles you to a piece of company profit should it be making any and or be a part of the rise or fall of said shares monetary value as determined by market forces.
Brief, but you should google for more info cheers c

 

[shinobi346]

As a substantial shareholder you can also help derail another companys plans to buyout the company by holding onto the shares and not selling.

Smaller shareholders can do the same but only if enough of them hold out. (generally if >10% of shares do not fall into the predators hands)

 

[doctorj]

Shareholders can do everything - depending on the number of shares (or proxies).

You can vote against board remuneration, block mergers, issues, get someone on the board, the list is really endless.

If you're a long term holder in a company, I'd say you should feel comfortable emailing or calling the MD with questions whether you have $5k or $5M worth. I frequently do it - I sometimes find myself calling MDs of prospective investments. If they're worth their salt, they'll make the time.

Like anything in the world of business, it's not what you know that will help you but who. Get along to relevant conferences and network and ask questions there. Build rapport. As a shareholder, or a prospective shareholder you can do anything.