A stock is a type of security that represents an ownership interest or equity in a corporation. Depending on the company's market value, a stock entitles an owner (referred to as "stockholders" or "shareholders") to a fraction of the company's earnings in the event of liquidation or business investment.

  • Stock Types:
    • Common Stock
    • Preferred Stock

Different classes of stock have distinct voting and economic rights. These rights can include voting on corporate decisions, receiving dividends before common shareholders, and priority in case of liquidation. A stockholder's ownership interest is typically represented as either a percentage of total outstanding shares or a specific number of shares listed on the company's capitalization table.

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