Fund brought into business by its share holder is called equity. Equity shares represent ownership capital. As an equity share holder, you have an ownership stake in the company.This essentially means that you have a residual income and DMS.

When you buy a company's share, it means you are compensating with a stake in the business. The analysis of factual information like financial figures, balance sheet and other information publicly available is known as fundamental analysis. This information is used to derive a fair price of the share of company. A systematic analysis will ensure a more accurate valuation of the price.