Stocks

A stock, or equity, is a claim on a company’s residual profits and on whatever it becomes. It is the asset that has compounded wealth fastest over every long window in the record, and the one whose price can halve in a year while the claim itself is unchanged.

Ownership

When you buy a stock, you become a shareholder in the company. This translates to partial ownership, entitling you to voting rights on certain matters and a share of the company’s profits, distributed as dividends.

Stock Price

The price of a stock fluctuates based on various factors like company performance, market sentiment, and economic conditions. These are the inputs any valuation ultimately rests on.

Types of Stocks

Different types of stocks cater to diverse investment goals. Common stocks offer potential for capital appreciation and dividend income, while preferred stocks prioritize consistent dividend payments.