What is a Stock?

Stocks (also called stock or share) are part of the capital stock of a company. It represents the original equity paid into the company. The capital stock could be traded at well-known stock markets like the New York Stock Exchange (NYSE) or NASDAQ. Every stock or share represents a partition ownership to the company. A stock owner has the ability to receive dividends and has a voting right for the annual general meeting (AGM). The stock owner participates on the business opportunities and risks.

There are two main stock types available: common stock and preferred stock. A common stock gives the shareowner the ability to vote at the annual general meeting and to receive dividends. A preferred stock has no voting right but for compensation, a higher claim for earnings and assets.

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