Stock - Page 25

Stock refers to the shares or ownership units of a company that are available for purchase or trading. When individuals buy stock, they are essentially purchasing a piece of the company, which may grant them certain rights, such as voting on corporate matters and receiving dividends, which are portions of the company's earnings distributed to shareholders. Stocks are typically bought and sold on stock exchanges, and their prices fluctuate based on market demand and the company's performance. There are two main types of stock: common stock, which usually gives shareholders voting rights and potential dividends, and preferred stock, which typically does not offer voting rights but has priority over common stock in dividend distribution. Investors buy stocks for capital appreciation, dividends, and portfolio diversification.