Stocks for Kids
-
share concept
- how make money from share
- who make money
- history
- test
What is Stocks / Share
Share/Stocks are Ownership which is split based on number of shares or stocks issued.
Hadeef's Jaya Grocer
- Hadeef owns 100% of Jaya Grocer.
- He has 1 outlet.
- One outlet profit is RM100,000 per year.
- He wants to add 10 more outlets but lack of money.
- Hadeef needs RM1,000,000 to add 10 more outlets.
- It takes 10 years to save money if Hadeef wants to create 10 outlets in a year.
Aliesha as Investor
- Aliesha has so much money but she wants to grow her money.
- Hadeef creates 1,000,000 shares of ownership. One share is RM1.
- He sells 500,000 share to Aliesha.
- Aliesha owns 50% of the company.
Hadeef & Aliesha as Owners of Jaya Grocer
- Now Hadeef & Aliesha have 11 outlets making RM100,000 x 11 = RM1,100,000 profit per year.
- But the profit must be shared between Hadeef & Aliesha.
- RM1,100,000 / 2 = RM550,000.
- Hadeef & Aliesha are called shareholders or owners.
Hadien wants to be Investors
- Aliesha & Hadeef sells 25% of their shares to Hadien.
- Hadien now owns 50% of the shares. He is now major shareholder of Jaya Grocer.
| Shareholders | Shares Own | Obtained Profit |
|---|---|---|
| Aliesha | 25% | RM275,000 |
| Hadeef | 25% | RM275,000 |
| Hadien | 50% | RM500,000 |
Bad Year for Jaya Grocer
- Jaya Grocer made loss of RM1,100,000
- Hadien loses much money because he owns more.
| Shareholders | Shares Own | Obtained Profit |
|---|---|---|
| Aliesha | 25% | -RM275,000 |
| Hadeef | 25% | -RM275,000 |
| Hadien | 50% | -RM500,000 |
Where to Buy Shares?
- Private company only open to certain people.
- Company with Sdn Bhd (Sendirian Berhad)
- Public company only open to everyone
- Company with Bhd (Berhad)
- example: Telekom Malaysia Bhd
Where to Buy Shares?
- Private company only open to certain people.
- Company with Sdn Bhd (Sendirian Berhad)
- Public company only open to everyone
- Company with Bhd (Berhad)
- example: Telekom Malaysia Bhd
Where to Buy Shares?
- In Malaysia, we buy at Bursa Malaysia
- Singapore - Singapore Exchange
- United States - New York Stocks Exchange
DEMO
Questions
1) Owners of a company is also called?
a) Shareholders
b) Co-owners
c) Entity
2) Stocks of ownership is also known as?
a) certificates
b) splits
c) shares
3) In Malaysia, we can buy stocks at?
a) Muzium Negara
b) Bursa Malaysia
c) Airport
Questions
4) Why company issues stocks?
a) To get money to grow their business
b) To share their ownership with others
c) To bring in new friends into the company