Often a distinction between different types of equity categories is made. Once shares have been identified as a certain type of equity this facilitates the link to the right investor profile and investment style.

Types of shares

Generally, shares are typified as:

  • Value shares: securities trading under their intrinsic value;
  • Growth shares: securities of a company which is expected to grow at an above-average rate compared to its industry or the overall market;
  • GARP (Growth At a Reasonable Price): A combination of value and growth investing;
  • Index shares: shares that allow investors to have a stake in an index without having to purchase each individual stock that comprises it;
  • Yield shares: Shares which have an interesting dividend yield (= annual dividends per share / price per share).

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