what are stocks 
a stock also known as equity is a security that represents the ownership of a fraction of the issuing corporation units of stock are called shares which entitle the owner to a proportion of the corporation s assets and profits equal to how much stock they own stocks are bought and sold predominantly on stock exchanges and are the foundation of many individual investors portfolios stock trades have to conform to government regulations meant to protect investors from fraudulent practices understanding stockscorporations issue stock to raise funds to operate their businesses the holder of stock a shareholder may have a claim to part of the company s assets and earnings a shareholder is considered an owner of the issuing company determined by the number of shares an investor owns relative to the number of outstanding shares if a company has 1 000 shares of stock outstanding and one person owns 100 shares that person would own and have a claim to 10 of the company s assets and earnings 2stockholders do not own a corporation but corporations are a special type of organization because the law treats them as legal persons corporations file taxes can borrow can own property and can be sued the idea that a corporation is a person means that the corporation owns its assets a corporate office full of chairs and tables belongs to the corporation and not to the shareholders 3corporate property is legally separated from the property of shareholders which limits the liability of both the corporation and the shareholder if the corporation goes bankrupt a judge may order all of its assets sold but a shareholder s assets are not at risk the court cannot force you to sell your shares although the value of your shares may have fallen likewise if a major shareholder goes bankrupt they cannot sell the company s assets to pay their creditors a person company or institution that owns at least one share of a company s stock