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whether a third person can buy a shares without any investment ? please give a brief explanation with a good samples

2007-08-07 20:01:39 · 1 answers · asked by vinodh s 1 in Business & Finance Corporations

1 answers

I thought I just answered a similar question.

A shareholder owns shares directly in a company. His name will be listed among the members or shareholders of that company. However if he has invested his funds in unit trusts or with asset managers or fund managers, he is an investment holder but he won't be the shareholder. Take a unit trust as an example:

A “Unit Trust” is a pooled investment plan where the capital contributions of investors are combined into a legally formed trust fund. The money is then invested by professional fund managers, acting on behalf of the investors, in a portfolio of marketable securities. A “Trustee” is appointed to safeguard the rights and interests of the investors. The investors receive “Units” (shares) in proportion to the amount of money they have contributed to the fund. The income derived by the fund by way of dividends, interests and capital gains are divided among the unit holders in proportion to their investments. So if you had placed your funds in this unit trust you won't find your name as a shareholder in those marketable securities which form the portfolio, cos the trust fund will be the named shareholder. You are the investment holder.

2007-08-07 22:04:32 · answer #1 · answered by Sandy 7 · 0 0

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