Common stock - Definition and Overview

Common stock, also referred to as common shares, are, as the name implies, the most usual and commonly held form of stock in a corporation. The other type of shares that the public can hold in a corporation is known as preferred stock. Common stock that has been re-purchased by the coporation is known as treasury stock and is available for a variety of corporate uses.

Common stock typically has voting rights in coporate decision matters, though perhaps different rights from preferred stock. In order of priority in a liquidation of a corporation, the owners of common stock are near the last. Dividends paid to the stockholders must be paid to preferred shares before being paid to common stock shareholders.

See also

• Preferred stock

Lists

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