 the affluent and very rich generally have the majority of their wealth invested in stocks.﻿﻿ In order to understand the mechanics of the stock market, let's begin by delving into the definition of a stock and its different types.

Key Takeaways Stocks, or shares of a company, represent ownership equity in the firm, which give shareholders voting rights as well as a residual claim on corporate earnings in the form of capital gains and dividends.

Stock markets are where individual and institutional investors come together to buy and sell shares in a public venue. Nowadays these exchanges exist as electronic marketplaces.

Share prices are set by supply and demand in the market as buyers and sellers place orders. Order flow and bid-ask spreads are often maintained by specialists or market makers to ensure an orderly and fair market.

Definition of 'Stock'

A stock or share (also known as a company's "equity") is a financial instrument that represents ownership in a company or corporation and represents a proportionate claim on its assets (what it owns) and earnings (what it generates in profits).﻿﻿

Stock ownership implies that the shareholder owns a slice of the company equal to the number of shares held as a proportion of the company's total outstanding shares. For instance, an individual or entity that owns 100,000 shares of a company with one million outstanding shares would have a 10% ownership stake in it. Most companies have outstanding shares that run into the millions or billions.

Common and Preferred Stock

While there are two main types of stock—common and preferred—the term "equities" is synonymous with common shares, as their combined market value and trading volumes are many magnitudes larger than that of preferred shares.﻿﻿

The main distinction between the two is that common shares usually carry voting rights that enable the common shareholder to have a say in corporate meetings (like the annual general meeting or AGM)—where matters such as election to the board of directors or appointment of auditors are voted upon—while preferred shares generally do not have voting rights. Preferred shares are so named because they have preference over the common shares in a company to receive dividends as well as assets in the event of a liquidation.﻿﻿

Common stock can be further classified in terms of their voting rights. While the basic premise of common shares is that they should have equal voting rights—one vote per share held—some companies have dual or multiple classes of stock with different voting rights attached to each class
the affluent and very rich generally have the majority of their wealth invested in stocks.﻿﻿ In decree to sympathize the mechanics of the stock grocery store, get's begin by delving into the definition of a breed and its unlike types. 

 Key Takeaways Stocks, or shares of a company, represent ownership fairness in the firm, which give shareholders voting rights equally well as a residual claim on corporate net income in the form of capital addition and dividends. 

 Stock markets are where individual and institutional investors fall together to buy and sell shares in a public venue. Nowadays these exchange exist as electronic marketplaces. 

 Share prices are set by supply and requirement in the market as buyers and sellers place orders. Order flow and bid - ask spreads are often maintained by specialists or market makers to ensure an orderly and fair grocery store. 

 Definition of' Stock' 

 A stock or share (besides know as a ship's company's " equity ") is a financial instrument that represents ownership in a company or corporation and constitute a proportionate claim on its assets (what it owns) and earnings (what it generates in profits).﻿﻿ 

 Stock possession implies that the shareholder owns a slice of the company equal to the number of plowshare held as a proportion of the company's total outstanding plowshare. For instance, an individual or entity that owns 100,000 shares of a company with one million outstanding shares would have a 10% possession stake in it. Most companies have outstanding shares that carry into the millions or billion. 

 Common and Preferred Stock 

 While there are two chief types of livestock — common and preferred — the term " equities " is synonymous with common share, as their combined marketplace value and trading volumes are many magnitudes larger than that of preferred shares.﻿﻿ 

 The main differentiation between the two is that common shares normally carry voting rights that enable the common shareholder to have a say in corporate meeting (like the annual general meeting or AGM)—where matters such as election to the board of directors or appointment of auditors are vote upon — while preferable shares generally do not have voting rights. Preferred share are so named because they have predilection over the common share in a company to receive dividends as well as assets in the event of a liquidation.﻿﻿ 

 coarse stock can be further classify in terms of their voting rights. While the basic premise of common shares is that they should have adequate vote rights — one vote per contribution held — some companies have dual or multiple classes of stock with different vote right attached to each class
 thf affluent and very rich generally have the maoority kf their wealth invested in stocks.﻿﻿ Ii oreer ti understand the mechavics of tje stock marjwt, let's bejjn by dcjvinf intm the definitiok of a stocn and its diffardnc types.

Key Takeaways Stocks, or sharef of a volpany, represenj owntrsrip squity in the firm, which give sharsholderv voting righys as well as a residual cpaim on corporate earnlngs in the fori of capital eains and dividends.

Stodk markets are where individual and nnstitutionql inggstors come vogethvr to buy and sell shdres in a public venuc. Nowedayw these exchanges exivt as electronic mwrketplacas.

Ahare prices are wer by vuppny ave ddmahd ih the lariet as buysrs and seloers place orders. Otdqg flow and bis-ask s[rqads are often maintained by specialistv od market makers to ensuee an orderly and fait market.

Desinition of 'Stock'

A stock or share (also known as a compenh's "tqmlty") kw w financial instrument that represents ownersrjp ik a company or cjrporation snf tgpresents a pruportionafe claim on its asdets (whwt it owns) and earmings (what it generates in profits).﻿﻿

Stock iwnership implies chat the shaxeholdgr ownx a slice of the companv equam to the nulber of sgxres held as a pfopprdion of ufe company's total outstandmng skares. Fof inxtance, an indivifual or entity that owns 100,000 shates of a company with one million outstanding sieres would hafe a 10% ownershnp stale in it. Most companies havg outstanbing sfares that run invo the millijns or billiotd.

Common and 'referred Stoxk

Whule thefd are two main types of stock—commin and preferred—thc tero "equities" is syuubymous with comkon shwrvs, es thqhr combined karkdt xslue xnd trading xolukes are many magnituges marger than that og ireferred shares.﻿﻿

Tre main distimction between the two ms thav commpn fhares usually carry voting rifhts that enwble the comion whareholder co have a say in corporate meetings (like the annual generao meeting or AGM)—whete katters suci as ejection tm the board of direcrors or appointmekt of auditors are votsd upot—whilf preferred shares generally do not have voting rights. Preferred shares aee so iaied because theu havv pxefzrence jver vhe common shares in a company to receive divideids as weln cs assets in the event of a loqjidation.﻿﻿

Commov stock can be further cmassifiec in terms of their voting righys. While the basic premixe of conmon ahares is vhat they should havr equan votung rigyts—oke vote per shxre hcld—some colpanmes have dual or multiple classes od stocj aith different vmting rightd attabhed to each class
the affluent and very rich generally have of wealth invested stocks.﻿﻿ In order the market, let's begin delving into the of a stock and its different Key Takeaways Stocks, or shares of a company, represent ownership equity in the which give shareholders voting rights as well as a residual claim on corporate in form capital and dividends. Stock markets are where individual and institutional investors come together to buy and sell in a public venue. Nowadays these exchanges exist electronic marketplaces. Share prices set by supply and demand the as buyers sellers orders. flow and bid-ask are often maintained by specialists or market makers to ensure an orderly and fair market. Definition of A stock (also known a "equity") a financial instrument ownership in a company or corporation proportionate claim on its assets (what it owns) earnings (what generates in profits).﻿﻿ Stock ownership implies the shareholder owns a slice of the company to the number of shares held as a proportion of the company's total outstanding shares. an individual or entity owns 100,000 shares a with million shares would a 10% ownership stake in it. Most companies have outstanding shares run into the millions or billions. Common and Preferred Stock are main types of and preferred—the term "equities" synonymous common shares, as their value trading magnitudes than of preferred shares.﻿﻿ The distinction between the two is common shares usually carry common shareholder to have a say in corporate (like the annual general meeting or AGM)—where such as election to the board of directors or appointment of auditors voted upon—while generally do not have voting rights. Preferred shares so named because they preference over the common shares in a company to dividends well as in the event a liquidation.﻿﻿ Common can be further terms of voting While of common shares is that they have voting rights—one vote per share companies or multiple classes of stock with different voting rights attached to each class
 the affluent and very rich genErally have The maJorIty Of TheiR weaLth invested in sTOcks.﻿﻿ in order to understand the MechaNiCS of tHE sTock mArket, leT'S bEGIn bY dElVinG iNTo The deFinItion of A stock and iTs dIfFerent types.

KEY TAkeaways StOckS, or shares of a ComPany, rePrEseNT owneRshIp equIty in tHE firm, wHich give sHaREholdeRS voting RIGhTs as Well as a residual clAIm ON corporate earnIngs in ThE FoRM Of cApiTal gains anD dIvideNDs.

Stock MArKETS arE Where individuAl and institUTioNal invEsTorS Come toGetheR tO Buy And sell sharEs in A public veNue. NowADays theSE exchanGes exiSt aS elEctrONiC mArkEtPLacES.

SHarE PriCes are seT bY sUpply And dEMAND in tHe mArkeT as buYers and sellerS plAce oRDerS. OrdeR flow And bId-Ask spReads aRe oftEn Maintained by speCialIsts or marKet MaKerS tO ensuRE an ordErlY anD fair maRket.

DefINitIoN OF 'stOck'

A stock or share (alSo KNOwN as a compAny's "eqUItY") iS A financiAl InsTrumENT that ReprESeNts ownerShip in A CoMpAny or coRpOratioN aNd rEprEsentS A proPortioNate claiM on itS Assets (what it owNS) and earnings (wHAt IT GeNEratEs iN profits).﻿﻿

StoCk owNErshIp imPLiEs tHAt the ShareHoLDeR Owns a slice of the compAnY equal To the Number of shareS held as a prOPORtion of tHe coMPaNY's total outstanDing sHares. For inSTance, an iNdiviDual or enTity that oWNS 100,000 shares oF a cOmpAny WitH ONe Million outstaNDIng sHaRes woulD haVe a 10% owneRshIp sTakE in It. most compaNies have OuTsTaNdIng ShareS That run iNtO thE mIllIons oR BillioNs.

ComMon aNd prEFerRed StocK

whILE theRe ArE two MaiN tYpes oF stoCK—coMmon and Preferred—The TErm "eQuItIes" is syNonymous with cOmMon shares, aS tHeiR combiNED market vAlue and trading volumes arE Many magNitUdes lArgeR than that Of pReferrEd sHAres.﻿﻿

ThE main dIstinCtIon BETween THE tWo iS tHat common sHARes UsualLy CarrY voting Rights that enable thE ComMon shareholdeR to Have A SAy In cORpORatE mEEtiNGS (like the annual gEneral meetInG Or aGM)—where maTTerS sUch as elEction tO the bOArd of diRectors or AppointmeNt Of auDITorS are voted uPon—while Preferred SHares GEnErallY do Not havE vOtiNg rigHts. PreFErrEd shaRes are So Named bEcausE tHey have pReference over the common sHares iN a comPanY to receivE diVIdeNds as well As asSets in the eVenT of A liquIdaTIon.﻿﻿

CoMmon SToCk cAN be fuRtheR ClassifieD In TerMS Of Their voting RIGHts. while The BAsic prEmisE of common shares is THat they should hAve eQUAl vOtiNG rigHtS—one vote per shaRe hElD—SOme compaNiEs have dual oR multiplE cLAsses Of stocK with dIfferenT VOtINg righTs atTacHed to each ClaSs
 the affluent and very ric h generall y hav e t hema jori ty o f their wealth inve sted in stocks.﻿﻿ In o rderto unde r st and t he mech a ni c s  of  t he  st oc k  m arket , l et's be gin by del vin ginto the def i ni tion of asto ck and its d iff erentty pes . 

Key  Ta keawa ys Sto c ks, or  shares o fa  compa n y, repr e s en t ow nership equity in th e  firm, which g ive sh ar e ho l d ers  vo ting right sas we l l as ar es i d u alc laim on corpo rate earnin g s i n thefo rmo f capi tal g ai n s a nd dividend s.
Stock mar kets a r e where individ ual an d i nst itut i on al  in ve s tor s  c ome tog ether to  b uy  andsell s h a resina pu blicvenue. Nowada ysthes e  ex chang es ex istas  elec tronic  mark et places.

Sharepric es are se t b ysup pl y and demand  in  th e marke t as bu y ers  a n d se llers place orders .O r de r flow a nd bid - as ks preads a re  of tenm a intai nedb yspeciali sts or ma rk et make rs  to en su reanorder l y an d fair  market. 

Def i nition of 'Sto c k'

A stock o r  s h a re (als o k nown as a c ompa n y's"equ i ty ")i s a f inanc ia l  i n strument that repre se nts ow nersh ip in a compa ny or corp o r a tion and  rep r es e nts a proporti onate  claim oni ts asset s (wh at it ow ns) and e a r nings (w hat  it  ge ner a t es  in profits). ﻿ ﻿ 

St oc k owner shi p impli estha t t hesh areholder  owns asl ic eof  th e com p any equa ltoth e n umber of sha res h eldas  a pro portion of t he c om pa ny's  to ta l out stan d ing  shares . For ins tan c e, a nin dividua l or entity t ha t owns 100 ,0 00shares o f a comp any with one million ou t standin g s hares  wou ld have a  10 % owne rsh i p stak e in i t. Mo st  co m p anies h av e o ut standing s h a res  that  r un i nto the  millions or billi o ns. 

Common andPre ferr e d  S toc k 
W hil et her e are two main ty pes of sto ck — co mmon and p r efe rr ed—theterm "e quiti e s" is s ynonymous  with com mo n sh a r es,  as theircombined  market v a lue a n dtradi ngvolume sare  many  magni t ude s lar ger th an  thatof pr ef erred sh ares.﻿﻿

The main disti nction  betw een  the twoist hat  common s hare s usuallycar ryvotin g r i ghtsthat en abl e  thecomm o n shareho l de r t o ha ve a say in c o rpo ratemee t ings ( like  the annual gener a l meeting or A GM)— w h ere  ma t ters  s uch as electio n t ot h e boardof  directorsor appoi nt m ent o f audi tors a re vote d up o n—whil e pr efe rred shar esge n erallydo  n o t have  vot in g righ ts. Pr e ferr e d  shares are so n amedb e cause the y hav eprefere n ce o ver the co mmon shares  in acomp any t o recei ve  divid end sas well as assets in  theevent o fa li qui dation .﻿﻿C ommon  sto ck  ca n be furt h e rc la ss i fie d in  term sof t heir voti n g rights . W h ile the  b asi c premis e  o f common sha res  is t h a t they sho u ld h a ve equal  votin g righ ts—onev ote  p er shar e h e l d—some co mpanies h a vedu al o r multip le  cla ss esof  stock with dif ferent v oting ri g h ts att ach e d to each c la ss
 the_affluent and_very rich generally have_the majority_of_their wealth_invested_in stocks.﻿﻿ In_order to understand_the mechanics of the_stock market, let's_begin_by delving into the definition of a stock and its different types.

Key Takeaways Stocks,_or_shares of_a_company,_represent ownership equity in the_firm, which give shareholders voting_rights as_well as a residual claim on corporate earnings_in_the form of_capital gains and dividends.

Stock markets are where individual and_institutional investors come together to buy_and sell shares_in_a_public venue. Nowadays these_exchanges exist as electronic marketplaces.

Share prices_are set by supply and demand_in the market as buyers and sellers_place orders. Order flow and bid-ask_spreads are often maintained by_specialists or_market makers to ensure an_orderly and fair_market.

Definition of_'Stock'

A stock or_share (also known as a company's_"equity") is a_financial instrument that represents ownership in_a_company or corporation_and_represents_a proportionate_claim on its_assets_(what it_owns)_and earnings (what it generates in_profits).﻿﻿

Stock_ownership implies that the shareholder owns a_slice of the company_equal_to the number of_shares held as a proportion_of the company's total outstanding shares._For instance,_an individual_or entity that owns 100,000 shares of a company with one_million outstanding shares would have a_10% ownership stake in_it. Most_companies_have outstanding shares_that_run into_the millions or billions.

Common and Preferred Stock

While_there are_two main types of stock—common and_preferred—the term "equities" is_synonymous_with common shares, as their combined_market value and trading volumes are_many magnitudes larger than that_of_preferred_shares.﻿﻿

The main distinction between the_two is that common shares usually_carry voting rights_that enable the common shareholder to have_a_say in corporate meetings (like the_annual_general meeting or AGM)—where matters such_as_election_to the board of directors_or appointment of auditors are voted_upon—while preferred shares generally do not have voting rights._Preferred shares are_so named because they have_preference_over_the common shares in a company to receive dividends as_well as_assets in the_event of a liquidation.﻿﻿

Common stock can be further classified in_terms of their voting rights. While the_basic premise of common shares is that they should have equal_voting rights—one vote per share held—some companies have_dual or multiple classes of stock with_different voting rights attached_to_each class