The shares certification also known as stock certificate and certificate of stock is a legal document to acknowledge the ownership of a person for a specific number of shares in a firm. Large business organizations often issue shares to the general public, but the purchase of shares does not always mean that you will get shares certification, because if a private individual buys a smaller number of shares, then he/she will not get the shares certification. Every country has its own rules and regulations regarding share certificates. For instance, in the United States, electronic registration has replaced the need for stock certificates.
Stocks in the United States and Sweden
The companies in the United States do not need to issue paper shares, because the broker has to bear $500 charges for issuing a paper certificate. The electronic securities are held electronically in the account of a broker just like a bank account. The paper-equivalent electronic share certificates are also issued by both public and private companies.
Sweden has no paper shares because people largely use electronic shares that are registered in the name of the owner or the broker of the owner. The share certificates are only used for those shares that are not listed on the stock exchange in Sweden. The share certificates are not so important in Sweden; you just get the voting right in the general meetings.
The shares are traded at a physical location that is widely known as a stock exchange. The importance of a share certificate is based on the type of share, because in some cases the share certificate is really important for the stockholder, but in some cases, it proves a piece of paper only.
Here is a preview of a Free Sample Stock Shares Certification Template created using MS Word,
Types of Share Certificates
The share certificates are available in two different types, including registered stock and bearer stock. The registered stock certificate serves as a paper record of the ownership of a specific number of shares. The transactions for the trade of these shared are tracked in a computer system. Do not worry about the loss or theft of the certificates, because the record can be retrieved from the database.
The other type is bearer shares that are issued by the company without any record of the ownership. These types of certificates belong to the person who has possession of the certificate. The original owner of the bearer stock can be traced in case of any theft or loss.
Uses of Share Certificate
The share certificates acknowledge the actual portion of ownership of a shareholder in an organization. The shareholder also known as a stockholder is entitled to a certain percentage of an amount in the assets of the company. This can be a cash amount or an asset of the organization that can be sold for cash. The liabilities of the company are opposite to its assets, and if the liabilities are subtracted from the assets, the remaining figure is known as the equity for the shareholders. It is also taken as the net worth of the company. Usually, the companies give a certain amount of dividend on their registered shares, but if the stockholder with bearer share wants to receive dividend payments, he should have shares certification.
Here is the download link for this Stock Shares Certification Template,
