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| Securities |
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| Numismatics the study of currency |
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Stocks (also capital stock, or sometimes interchangeably, shares) consist of all the shares[a] by which ownership of a corporation or company is divided.[1] A single share of the stock means fractional ownership of the corporation in proportion to the total number of shares. This typically entitles the shareholder (stockholder) to that fraction of the company's earnings, proceeds from liquidation of assets (after discharge of all senior claims such as secured and unsecured debt),[3] or voting power, often dividing these up in proportion to the number of like shares each stockholder owns. Not all stock is necessarily equal, as certain classes of stock may be issued, for example, without voting rights, with enhanced voting rights, or with a certain priority to receive profits or liquidation proceeds before or after other classes of shareholders.
Stock can be bought and sold privately or on stock exchanges. Transactions of the former are closely overseen by governments and regulatory bodies to prevent fraud, protect investors, and benefit the larger economy. As new shares are issued by a company, the ownership and rights of existing shareholders are diluted in return for cash to sustain or grow the business. Companies can also buy back stock, which often lets investors recoup the initial investment plus capital gains from subsequent rises in stock price. Stock options issued by many companies as part of employee compensation do not represent ownership, but represent the right to buy ownership at a future time at a specified price. This would represent a windfall to the employees if the option were exercised when the market price is higher than the promised price, since if they immediately sold the stock they would keep the difference (minus taxes).
Stock bought and sold in private markets fall within the private equity realm of finance.
- ^ a b Summers, Della (2007). Longman Business English Dictionary. Pearson Longman. ISBN 978-1-4058-5259-3. OCLC 954137383.
stock - especially AmE one of the shares into which ownership of a company is divided, or these shares considered together"
"When a company issues shares or stocks especially AmE, it makes them available for people to buy for the first time. - ^ stock Archived 30 April 2021 at the Wayback Machine in Collins English Dictionary: "A stock is one of the parts or shares that the value of a company is divided into, that people can buy."
- ^ "stock". Investopedia. Archived from the original on 25 December 2018. Retrieved 25 February 2012.
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