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Common Stock

Common Stock, or common shares, are the basic shares of a company that can be purchased by any investor (so long as the company is publicly held.) Generally when people own stock in a company they own common shares, however other types of stock do exist. Common shares differ from preferred stock in the rights that they offer to their shareholders. While common shareholders do have voting rights at shareholder meetings, they have the last claim on a company's earnings or assets. That is, before any dividends are paid to common shareholders the preferred shareholders and debt holders of the company are paid. Furthermore, if a company files bankruptcy, the common shareholders will be the last to receive any payments from liquidation.

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