Questions and Answers for the New Investor

What are Share certificates?

Certificates are evidence of your ownership of the shares and represent your interest in the company.

What is a Nominee account?

A nominee account is a facility whereby a client's shareholdings are not registered in his / her own name in the form of a share certificate but in the nominee company of a stockbroker, with a designation corresponding to the client's account. The beneficial ownership of the shares remains with the client, while the stockbroker handles many of the administrative issues on behalf of the client.

How can I transfer shares to another person?

Goodbody can provide a transfer form which, when completed, gives authority to the registrars to transfer the shareholding out of your name and into the name of your designated beneficiary.

Can I sell shares that are in my children's names?

Legally, a child under 18 years of age may not have shares registered in their own name. Usually, if shares are purchased on behalf of a child, they are registered in the name of a guardian, who is free to deal in the shares on behalf of the child.

What if I lose my share certificate?

Each publicly listed company employs the services of a company registrar who keeps a record of your name, address and the number of shares you own. If your certificates are lost, you should contact the registrar who will arrange for you to complete a "Letter of Indemnity". Once this is done, the registrar will send you a duplicate certificate.

Why do some companies have an Irish market quote and an overseas quote?

Many of the larger Irish companies have a stock market listing on an international market as well as the Irish Stock Exchange. These listings are usually on the London Stock Exchange, the New York Stock Exchange or the US NASDAQ Market. These overseas listings are designed to facilitate and attract investment in these companies by overseas investors.

What are the key rights of a shareholder?

Shareholders have the right to receive dividends (if payable), to receive key company information (such as annual reports), to attend Annual General Meetings and to vote on certain affairs of the company.

What are dividends?

Dividends are payments by the company out of operating profits to shareholders and are typically paid net of tax. Most Irish companies pay dividends twice yearly.

What are scrip dividends?

Scrip dividends allow you to convert your cash dividend into more shares of the company. The registrar calculates the number of shares that can be bought with your cash dividend and then purchases this number of shares on your behalf.

What is meant by 'Ex dividend'?

Prior to announcing each dividend, companies set a date on which shares will be sold without entitlement to the dividend. Before that date they are said to be 'cum dividend'. Therefore, if you sell shares after the ex-dividend date you will not be entitled to receive the dividend. If you sell shares before the ex-dividend date, you will be entitled to receive the dividend.

What happens to my shares when I die?

Shares are just like any other asset and will be disposed of by your executors according to your will. Your solicitor requests a valuation for probate purposes from your stockbroker. The shareholdings are frozen until probate is granted at which point your solicitor sends the original "Grant of Probate" together with the share certificate to each company registrar who notes the death and the names of the executors. The executors are then free to either transfer the shares to beneficiaries or sell them, in accordance with the terms of the will.

What are standard settlement periods?

The standard settlement period for Irish, UK and US equities is T+3, i.e. settlement three working days after the trade date. Irish and UK gilt settlement is also T+3. European countries employ varying settlement practices.