Common stock is a form of corporate equity ownership, a type of security. The terms voting share and ordinary share are also used frequently in other parts of the world; "common stock" being primarily used in the United States. They are known as equity shares or ordinary shares in the UK and other Commonwealth realms. This type of share gives the stockholder the right to share in the profits of the company, and to vote on matters of corporate policy and the composition of the members of the board of directors.
The term "common stock" indicates that the investors in the company do not own any particular assets, but that instead all of the assets are the shared, or common, property of all investors. A corporation may issue both common and preferred stock, in which case the preferred stockholders have priority to receive dividends. In the event of liquidation, common stock investors receive any remaining funds after bondholders, creditors (including employees), and preferred stockholders are paid. When the liquidation happens through bankruptcy, the common stock investors typically receive nothing.
Common stockholders can also earn money through capital appreciation. Common shares may perform better than preferred shares or bonds over time, in part to accommodate the increased risk. Wikipedia
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