Stock
Candlefocus EditorCommon stock represents the most common type of stock, and it typically provides shareholders with certain voting rights, either directly or indirectly. Shareholders of common stock hold a residual claim on the company's assets and earnings after creditors, preferred stockholders and other security holders have been paid. This means that common stockholders are the last in line when it comes to claiming the company's assets and profits.
Preferred stock is a type of stock that provides shareholders with preferred dividends or distributions over those paid to common stockholders. Unlike common stock, preferred stock does not come with voting rights. Therefore, when it comes to matters related to the company’s management, owners of preferred stock typically have no say in the matter.
Stock has traditionally been one of the most popular investments for long-term investors, since it has historically outperformed other investments over the long run. It is important to note, however, that investors should keep their financial goals in mind as they consider investing in stock — stock investing involves significant risk and can yield tremendous rewards in addition to losses. Therefore, it is important to research thoroughly before investing and to diversify investments across different stock types.