Definition, Meaning & Synonyms

common stock

Noun

/ˈkɒm.ən stɒk/

Definition

Common stock is a type of security that represents ownership in a corporation and constitutes a claim on part of the company’s assets and earnings.

Examples

After purchasing common stock in the company, she became a part owner.
Investors often choose common stock for its growth potential.
He received dividends because he owned common stock in the corporation.

Meaning

As a shareholder of common stock, you have voting rights in the company, which can influence corporate policy and decisions. Common stock typically has the potential for capital appreciation over time, as well as dividends, though dividends are not guaranteed.