when are the number of shares of a company fixed? before IPO is the number fixed?
Roma asks:
What is the relation of face value and market value of a share? When a company releases its shares, it first finds out what price people are willing to pay for the share. But how are the total number of shares a company has decided? If a company converts 1 share into 2 shares, what happens to face value?
What is the relation of face value and market value of a share? When a company releases its shares, it first finds out what price people are willing to pay for the share. But how are the total number of shares a company has decided? If a company converts 1 share into 2 shares, what happens to face value?
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The par value and number of shares are fixed by the Secretary of State in the state you file your articles. The companies will have the share certificates printed and sold to investment houses. When they run out, they have to apply for more.
Shares aren’t allowed to go below par value.
Market value is whatever the market is willing to pay for one share.
Companies can guess at the price people are willing to pay, but I’ve found them to be wrong at least half the time. The market price is decided by old fashioned supply and demand.