Stocks are considered to be a type of financial security or investment that gives stockholders or investors a share of ownership of a company or business. Stocks can also sometimes be referred to " equities "or "shares". Stocks gives you the ability to stake a claim in a company's assets or earnings. Depending on how much money you have invested into purchasing a company's stocks, will determine how much ownership you are entitled to. Stocks are presented with a stock certificate that shows that you have proof of ownership. One important benefit of stocks is that there is a limited liability, which means that if the company goes bankrupt, you are not held personally responsible and you will not lose any of your own personal assets. Owning stocks in a company does not guarantee that you will make any money on your investment.
Stocks are represented in two ways: common stock and preferred stock. Stocks that are considered common are usually the stocks that everyone is referring to when they may discussing stocks about a company. Common stocks are what the majority of people invest into when they are buying share of a company. Stocks that are considered preferred designate some amount of ownership in the company but will not typically give the same voting rights of the other owners of a company. Preferred stocks can give the investor a fixed dividend and are paid before a common stock is paid. There are many options to buying and selling stocks and those are a direct stock plan, a dividend reinvestment plan, and a stock fund. To find out how stocks can work for you and further your investments, contact United Retirement Advisors Group to discuss your options.