How to Understanding Stock Market for Dummies
Stocks Basics By Adam Hayes, CFA Never depend on a single source of income.... Warren Buffet Stocks are claims to a company’s profit stream and are granted voting rights in installing its board of directors or in approving large corporate actions such as being acquired. Shareholders are not owners of a corporation’s assets and do not involve themselves with corporate management. Stock is equity, bonds are debt. Bondholders are guaranteed a return on their investment and have a higher claim in recovery from a bankruptcy than shareholders. This is generally why stocks are considered riskier investments and require a higher expected rate of return.You can lose all of your investment with stocks. The flip-side of this is you can make a lot of money if you invest in the right company.The two main types of stock are common and preferred. It is also possible for a company to create different classes of stock. Stock markets are places where buyers and sellers of stock meet