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Stocks

A stock (or share / equity) represents partial ownership in a publicly traded company. When you buy a stock, you become a shareholder with a proportional claim on the company's assets and earnings.

🔑 Key Characteristics

Property Detail
Code in LibreFolio STOCK
Pricing Real-time or delayed quotes from exchanges (NYSE, NASDAQ, LSE, etc.)
Currency Denominated in the exchange's local currency
Dividends Many stocks pay periodic cash dividends (quarterly in the US, semi-annually in Europe)
Splits Companies may split shares (e.g., 4:1) to lower the per-share price
Typical providers Yahoo Finance, CSS Scraper

📊 How Stocks Work

  1. Price discovery: Stocks trade on public exchanges during market hours. The price reflects supply and demand.
  2. Dividends: Companies may distribute a portion of profits to shareholders. This creates a Dividend event on the ex-date.
  3. Capital gains: The difference between buy and sell price determines your profit or loss. See Taxation.
  4. Splits: A company may split its shares to improve liquidity. A 4:1 split means each share becomes 4 shares at ¼ the price. See Split event.

📐 Total Return

The total return of a stock includes both price appreciation and dividends:

\[ R_{total} = \frac{P_{end} - P_{start} + \sum D_i}{P_{start}} \]

where \(D_i\) are all dividend payments received during the holding period.