Equity share signifies an ownership position in a corporation. Equity shareholder enjoys the dividend distributed out of profits earned by the company. An equity investment generally refers to the buying and holding of shares of a company by individuals in anticipation of dividends and capital gains.
Share certificates are issued to investors by the company. Share certificate carries the information such as the name of the owner and number of shares owned by the investor.
Entrepreneurs raise money by issuing equity shares to investors. This enables the entrepreneur to have the money required for the business and simultaneously it allows small investors to participate in wealth creation and benefit in the form of dividends declared out of the profits of the company. Share holders also make money in the form of capital appreciation. If the share you purchased at Rs. 10 is sold for Rs. 20 in the stock market, the profit you make is called capital gains.
