Canadian Companies Common Shares



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Common stock represents a small portion of ownership of a company. If you own common stock in a Canadian company, then you, in effect, have a small say in the direction, management, and profits of the company.

Holders of common stock have voting rights (typically 1 vote per share) when it comes to selecting the board of governors for a corporation. Owners of preferred shares or bonds do not have any say over the direction of the company. The company merely owes them money and pays interest on it. As a Canadian stock holder, you are entitled to acess to reports on the company’s fiscal situation.

 

Because of this Canadian companies have to report their indepth financial situation regularly via SEDAR and/or on their website and/or via paper to the stock holder. Because of these reports, it not only keeps current stock holders informed, this also enables individuals who are researching Canadian securities and analyzing them to potentially buy them to get informed. This is called Fundamental analysis. You can read more about Fundamental Analysis here.

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Common stocks are often referred to as "voting shares" in a company since shareholders decide who the directors are. Quarterly reports (10-Q) filings can keep investors informed as to the goings on in the company and give them an idea who is running for the board of governors. Shareholders can either vote by proxy - through the mail or the internet - to decide who gets to be the top directors : CEO, CFO, and others.

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