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Common Stock

Common Stock

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Published by kishorepatil8887

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Published by: kishorepatil8887 on Mar 31, 2010
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Common stock
Common stock
, also referred to as
ordinary shares
, are, as the nameimplies, the most usual and commonly held form of 
in acorporation. The other type of shares that the public can hold in a corporation is known aspreferred stock.Common stock that has been re-purchased by the corporation is known astreasurystockand is available for a variety of corporate uses.Common stock typically has voting rights in corporate decision matters, thoughperhaps different rights from preferred stock. In order of priority in aliquidationof acorporation, the owners of common stock are near the last. Dividends paid to thestockholders must be paid to preferred shares before being paid to common stockshareholders.[1] [edit]
Preferred stock
Preferred stock, sometimes called preferred shares, have priority over commonstock in the distribution of dividends and assets.Most
shares provide novoting rightsin corporate decision matters.However, some preferred shares have special voting rights to approve certainextraordinary events (such as the issuance of new shares, or the approval of theacquisition of the company), or to elect directors.[2] [edit]
Dual class stock
Dual class stockis issued for a single company with varying classes indicatingdifferent rights on voting and dividend payments. Each kind of share has its ownclass of shareholders entitling different rights.[edit]
Treasury stock
Treasury stockare shares that have been bought back from public. Treasury Stockis considered issued, but not outstanding.[edit]
Golden share
Golden shareis a special share giving its holder a right to vote the Board'sdecisions. Usually, a government owns golden shares of important enterprises thatwere privatized. Golden shares are mostly used in European countries.[edit]
Stock derivatives
For more details on this topic, seeequity derivatives.

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