There are we talk about Stock capital or Stock Cash & Stock Future. The Capital stock of a business body which represents the unique capital paid into or invested in the business by its founders. We can say its serves as a security for the creditors of a business but it cannot be reserved to the strong-minded of the creditors. Stock is the totally dissimilar from the Property and the property of a business which may change in quantity and cost.
Stock generally takes the form of shares of either common stock. As an element of ownership, common stock characteristically carries voting right that can be exercised in business decision. Ideal stock differs from common stock in that it classically does not take selection rights but is officially free to take delivery of a certain level of dividend payment before any dividends can be issued to other shareholders.
Preferred stock may be mix by having the qualities of bonds of fixed income and common stock voting rights. They also have preference in the payment of dividends over common stock and also have been given preference in the payment of dividends over ordinary stock and also have been given preference at the time of liquidation over common stock. They have other features of buildup in dividend
Cash is effective of what is wanted to operate business. Extra cash is not included in the business valuation, because it doesn’t help in the manufacture of free cash flow. Extra cash work more as a pillow that reduces risk for business.
Surplus cash also allows a business to avoid the require for debtor financing. Excess cash also allows a business to make planned acquisition quickly, because cash avoid the use of bank financing, which is another layer of security.
Future Market (Stock Future): A future contact is an agreement between two parties to buy or sell property in a certain time in future at current price. Future contracts are specially type of forward contracts in the sense that the former are standardized traded contracts such as futures of the nifty index.
A future is an agreement between two parties where one side buys a specific amount of commodity by metals, grains, oil, etc at a particular price, regardless of what the actual price is when the contract comes due, the buyer pays a premium.
Future is similar to options, except where the option gives the buyers a correct, but no compulsion, to purchase the underlying item, the buyer of a future contract he must buy the underlying .the future buyers can always close the long position by selling going short an identical contract. If that short contract has a higher premium than the long one did, then the future trader made money.
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