Definition

Common stock

Common stock refers to the stock that is issued more broadly than preferred stock and that gives the stockholders voting rights and elect the board of directors of the firm. The common stockholders are typically the last to get paid in the event of the liquidation of the corporation, that is, after the creditors and the preferred stockholders.

After chartered, the corporation may begin selling ownership rights in the form of shares of stock. When a corporation has only one class of stock, it is common stock which gives the stockholder the ownership rights in a corporation. A corporation’s articles of incorporation or its by-laws state the ownership rights of a share of stock.


Common stock is type of bank capital measured by the par value of all common equity a share outstanding that pays a variable return to its owners after all expenses and other claims are met.


Common stock is a security that is a claim on the earnings and assets of a company.


Common stock that confers voting rights but does not grant preferential rights of dividends or claims against the assets of the firm.

 

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