Share refers to the units in which the total share capital of a company is distributed. Therefore a share forms a part of the share capital and it forms the basis for ownership rights in a company.
The differences between preference shares and equity shares are as follows:
- Preference shares provide a fixed dividend to the shareholder while equity shares provide dividends based on the profit and loss of the company.
- Preference shares can be redeemed while equity shares are not redeemable.
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