Analysis

Stock classifications

The Capital Market

The conceptual bases of the stock market and how investors, the stock exchange and companies use this market and interact will be shown on this page.

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It should be emphasized that, together with the request to go public, some companies request authorization to sell stock to the public.

The complete requirements for public distribution offers can be seen at CVM Instruction No. 400/03. In sum, the conditions for making an offer involve information on the offer itself, the securities offered and the rights they provide, information on the issuing company and its equity, economic and financial data.

How the stock market is divided into primary and secondary parts

For a stock to be traded on the exchange, the BM&FBovespa has established some company requirements, including:

Preference

Common stock 
Gives its holder the right to vote in shareholders' meetings and participate in the economic profit of the company. It is represented by the number three at the end of the share abbreviation, for example: PETR3, CSNA3, GGBR3.

Preferred stock 
Grants its holder preference in the receipt of dividends and, in the case of liquidation, preference in capital reimbursement. It does not give the holder the right to vote in shareholders’ meetings. More than one type of preferred stock can exist and the difference between them can be checked in the bylaws. They are represented by the number four for PN (Ex.: PETR4, GGBR4), five for PNA (VALE5), six for PNB, seven for PNC, and eight for PND.

Types of register

The stock can be 

Registered
Book-entry
Holder

Are the actions of identification with their owners.

The identification of owners occurs by identifying through the book of Registered Shares or statement sent by the custodian.

It is characterized by being deposited at a depository financial institution, in which the values are posted to the debit or credit shareholder.

Comes without identifying property; belongs to who present the stocks.

Listing segments

The special listing segments of the stock exchange were created by BM&FBovespa more than 10 years ago, when the exchange recognized that to develop the Brazilian capital market it was necessary to have corporate governance rules.

Learn more.

Liquidity

Although there is no formal standardization, one can say that there are three stock classifications:

  • Blue chips
  • Second line
  • Third line

Learn more.

Types of market

This classification refers to the trading form and divides the market into:

  • Standard lot market, in which shares are traded in groups (normally 100 shares);
  • Odd lot market, in which individual shares up to a standard lot are traded
    (with at least 1 and at most 99 shares).
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