Investing is something that everyone should do. There are many advantages to investing that it makes no sense not to get started. It will provide you with financial stability and will help you grow your money. Investing your own money has its risks as well as its advantages. As an investor, you get nothing in return if anything bad happens or the company goes bankrupt.
If you decide to invest your money somewhere, you must be aware of your rights. These rights will save you from many problems that you may face. They will also guide you on how to do your work and what you are allowed to do in the firm. Having this knowledge is essential to understand your part and prevent any fraud. Here are 6 important things you should know if you are investing your money.
Voting
Shareholders who buy stock in a corporation hold common stocks and can vote at the company’s meetings. However, those who hold preferred stocks have no vote. Having voting powers allow you to have a say in selecting the directors. In addition, you are also allowed to vote regarding any changes affecting the company. Annual meetings are held where voting takes place. If anyone has a new idea that will benefit the firm, they present it, and then the rest of the shareholders vote to decide according to the majority opinion. Having the power of voting even if it is limited will give you control over the company and this is very important if you are depending on this investment as your only source of money.
Wrongful Acts
Investors can press charges in case they have been wronged. These charges can be pressed individually by the investor or on behalf of the whole company against a third force. This third force might be a director in the company, with most of their mistakes being either fraud or mismanagement that has been disregarded by one of the workers.
These lawsuits are filed to protect the investor’s interest. Just like how people will do it with any wrongful act, you can search for help to protect your investment from fraud. As your guide when searching for a legal representative who will help you with fighting for your rights, Frankowski firm highlights the importance of partnering with attorneys that will hold your wrongdoers accountable for their actions. Because of the complexity of your case, the attorney you will hire should be knowledgeable of state and federal securities laws. It’s fundamental to have the expertise of fraud attorneys especially if you are ever at serious risk of fraud.
Looking Over the Company’s Records
When you have common stock in a company, you are given the right to look at the firm’s financial records and the notes from the investor’s meetings in case you weren’t able to attend. However, this case can be different in each country. In some companies, investors must send a written inquiry to the company for seeking inception. The company can deny the investor’s request too but the investor can resort to court interference.
Profits
As partial owners of the company, common investors have the right to participate in the profits as long as they invest their money in the company. The profit depends on the number of shares that the investors own in the company. Furthermore, common shareholders can lay a claim on some of the assets owned by the firm. This is because these assets accomplish and produce profit for the company.
Transfer Ownership
Having the right to transfer your ownership means that investors have the right to trade or sell their shares if they want to and whenever they want to. You can transfer your shares to another investor, either a new one or an existing shareholder. In most cases, shares are transferred to new investors. It is very important that you contact your account manager before taking any action for you to have the perfect plan.
Limited Liability
If the company is in debt or has been sued, investors are only responsible for the amount of money they have invested in the business. Their personal assets should not be under threat. The bank can not reserve the investors’ assets.
It’s essential for any investor to check and carefully research the guide according to their country since investors’ rights vary from one country to another. However, these six basic rights are common in most countries. Besides knowing the benefits and advantages that you will gain when owning shares in a company, you must know the rights that will help you do so. These rights are available to protect you and your money from any fraud. Such a step as investing your money is a huge risk, you will be depending on the return you get from the investment.
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