LeoGlossary: Stocks

1 mo (edited)
LeoFinance
1 Min Read
124 words

Also known as equity.

A security that represents fractional ownership in a corporation. Stock ownership gives one a right to the assets and profits of the company. This is dependent upon how many shares one owns.

Stocks are traded on exchanges, which bring buyers and sellers together. The typical ones are the New York Stock Exchange (NYSE) or NASDAQ.

Companies can use stock as a way to raise money.

There are generally two types:

  • Common
  • Preferred - often do not have voting rights yet have a higher claim to assets

Historically stocks as an investment have outperformed other assets over the long run. The exception being Bitcoin which has a much shorter track record.

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