Shares

Shares, also known as stocks or equity, are units of ownership in a corporation. Each share represents a claim on part of the company’s assets and earnings and may confer a right to participate in profits in the form of dividends and to vote on certain corporate matters, depending on share class.

The two main types are common shares and preferred shares. Common stocks typically carry voting rights and participate in residual profits after other claims; preferred stocks generally offer fixed dividends and priority over common shares in distributions and liquidation, but often have limited or no voting rights.

Share capital is the total amount raised by issuing shares. Par value is largely symbolic in many markets but may persist in some jurisdictions. Shares trade on primary markets through issuances and on secondary markets through stock exchanges or over-the-counter markets, with prices determined by supply and demand.

Market capitalization equals the share price multiplied by the number of shares outstanding. Liquidity varies by market and by company; large, well-known firms tend to have highly liquid shares, while smaller issues can be harder to trade. Investors may realize capital gains or losses from price movements.

Shareholders have rights including dividends (where declared), voting on certain corporate matters at annual meetings, and a claim on remaining assets after creditors and preferred shareholders. Some companies issue multiple classes of shares with differing rights, which can affect control and economics.

The market for shares is regulated by securities authorities that require disclosure, financial reporting, and fair trading practices. Investors face risks such as price volatility and dilution from new issues, and taxation of dividends and gains varies by jurisdiction.