What is stock?

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A stock ,also known as equity or shares is a security that represents the ownership of a fraction of a business. Owning a stock implies that you own shares or a piece of corporate equity, which is traded on a stock market and noted as publicly traded companies. This ownership makes you a Shareholder. Please note that shareholders do not own corporations; rather, they have ownership in the form of shares created by the companies.

The quantity of outstanding shares is what determines a stock's value. The equity value is the amount of shares a person owns in comparison to the overall amount issued.

Businesses raise money by issuing (selling) stocks to the public in order to run their business. Stock is divided into two categories: common and preferred. Ownership shares differ from one another in that common shares give investors voting rights on corporate decisions, while preferred shares entail priority when dividends are paid.

Investing in the stock market used to be reserved to experts in the field but thanks to online investment platforms linked with various exchanges, everyday investors can now invest in stocks too.