stocks96

There are two types of stocks Common Stock Preferred stock. Common stock: Common Stock is an investment security that represents the ownership of a company. For example, To a very close person, you say that he owns stock of a particular company then that stock is called   common stock in  types of stocks . Where Total Return = Income received from investment + Any change in its value Features of Common Stocks The right to receive dividend payments typically from earnings. If allowed by the board of directors . The power to sell the stock (liquidity rights) and realize capital gains on public  trading   markets or in private transactions. If there are willing buyers. The right to receive consideration in a merger or other fundamental transaction. If approved by the board and the shareholders. Advantages of Common Stock Common stock has the potential for delivering very large gains, unlike a bond, certificate of deposit, or some other alternatives. It limits t