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TeachMeFinance.com - explain stock Stock -- Ownership shares in the assets of a corporation. another definition... stock -- (1) shares of ownership in a corporation. (2) the capital raised by the sale of shares. (3) a certificate that shows ownership of a stated number of shares. historic definition... Stock -- The capital of a company represented by shares for which negotiable (transferable) certificates are issued. The usual varieties of stock in the United States are preferred (there may be first and second preferred and even third preferred) and common (occasionally called ordinary or general stock). Preferred stock is preferred as to assets and dividends. It must receive a dividend before one can be paid on the common stock and in a distribution of assets it participates ahead of common stock. Cumulative preferred stock is stock the dividends on which if not paid regularly or in full accumulate and must be paid in the future before a dividend can be paid on the common stock. Common stock is not preferred as to dividends or assets and seldom or never is made cumulative. Often its chief value is its voting power. In addition there is founders' stock, which is issued to the organizers of a company for services. It is entitled to participate in profits after a certain rate of dividend has been paid on the common stock in any one period. About the author Mark McCracken Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English". Copyright © 2005 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.