In the world of business and finance, the term stock would refer to the ownership share in a company. It is the capital fund raised by the corporation which can be traded or sold on the stock market exchange.
Generally, the value of a company is dependent on the value or worth of its shares. The market however, changes and fluctuates on a daily basis. Thus, the value of the share would also change depending on the movement on the market.
Shares are the units of accounts in a stock or the equal portion of a company’s capital. An individual who owns a share is called a shareholder.
A stock share may result to a profit called dividend. Each time a company earns revenue a portion of this profit is distributed among shareholders. However, the amount received by the holder would depend on class as well as the quantity of the share.
Aside from earning a part of the company’s income, shareholders are also given special privileges. In some countries, shareholders have the right to elect the corporation’s board of directors. Each holder is given a percentage of a vote which is proportional to the percentage of his or her share.