Different types of stocks
Since 1987 the categorization of stocks has been done. From that onwards the trend was followed in the stock market.
There are two types of stocks;
Class A
Class B
The stocks are divided in two classes A and B. Both of them play different role in a company. Both of them have their individual power to act in the company.
Most of the investors prefer one class stock. If there is more than one class in a stock they are not preferred more and are not called common stocks.
”Common stock” is common word heard by every one. Every one is eligible to purchase this common stock of a company.
Every company has common stock. Any one can purchase these stocks. The value of these stocks rise as company grows and falls when the company performs poorly.
The holder of common stock does not participate in the day to day affair’s of the companies operation. But have power to elect the board of directors.
There is an upscale stock known as preferred stock. These stocks are the mixture of a stock and a bond.
The holder of the preferred stock has power to put claim on the assets of the company in the case of bankrupt.
The list of benefits not finish till now, one more is their. Preferred stock holder gets the dividend before the common stock owner.
As every coin has two faces, company has right to buy the stock back from you any time and stop paying dividend.
Now, it’s your choice, you want to invest money on which stock.
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