What is a Stock?

Usually people mean common shares when they refer to "stocks" or the "stock market". A common share is a financial security that gives the holder an ownership claim in a company.

It gives the holder right to receive dividend distributions and a vote at the company's annual meeting. The shareholders vote to elect the directors of a company who appoint the company's management and set the dividend policy. The shareholders have specific rights under corporate law and the company's bylaws. Shares that are "publicly listed" on stock exchanges and are required to provide information or "disclosure" to their shareholders in return for being publicly traded. Common shares are also referred to as "equity securities" or "equities" alluding to the accounting term "Owner's Equity". Investors and commentators use the terms "equity market" or "equities" when they refer to stocks or the stock market.

To learn more, click on the "Bar of Knowlege".

What is a Stock?

Usually people mean common shares when they refer to "stocks" or the "stock market". A common share is a financial security that gives the holder an ownership claim in a company.

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