All You Need To Know About Stocks

Stock is the shares in which ownership of a particular company is limited. In common English, the stocks are collectively referred to as’stock’. Each share of this stock represents an insignificant fraction of a percentage of overall ownership of the company. Stocks are usually issued by publicly traded companies; there are several different types of stocks. Common stocks, preferred stocks and common stocks are the various types of stocks available.

The common stock is the most commonly used and therefore, is the most easily accessible. The shares are listed on the New York Stock Exchange (NYSE) or the American Stock Exchange (ASX). These companies have to have a minimum number of shareholders (owners) registered with the SEC (Securities Exchange Commission). A majority of stocks are usually preferred stocks. Preference stocks are the ones that are listed on the main exchanges and have the greatest probability of rising in value due to the increase in number of buyers.

There are several other types of stocks. Dividend stocks are issued by corporations to its end users such as employees and shareholders. The dividends are received by the corporation out of net profits. Initial public offerings are an alternative to public offerings and these are the stocks given away for free to potential shareholders by the issuing company to create a rise in its share price. Lastly, debt securities represent an agreement between a corporation and an investor whereby the latter would pay off a certain amount of money as interest and the former would in return issue shares of its stock as repayment.