Advantages of establishing a company limited by shares:
1. The financing speed is fast and the scale is large. Because a joint stock limited company can raise funds by issuing stocks and corporate bonds, it can raise a large amount of funds in a short time, which is convenient for enterprises to get rid of financial difficulties or further expand their business scale.
2. It is conducive to diversifying investors' risks. There are many shareholders in the joint-stock company, and the equity is scattered, which effectively disperses the investment risk of investors; In addition, the shares of a limited company can be freely transferred, which greatly facilitates the risk transfer of investors. At the same time, the decentralization of equity greatly reduces the control cost of most shareholders.
Of course, the establishment of a joint stock limited company also has obvious defects. Due to the large scale and complex membership structure of the limited company, its establishment and operation conditions are strict and complicated, and its establishment and operation costs are higher than those of other companies. In addition, although the free transfer mode of joint stock limited company can facilitate investors to transfer risks, the free transfer and trading of shares are also prone to excessive speculation.