Stock (also referred to as equity or share) is a type of security that signifies ownership in a company and represents a claim on part of the corporation's assets and earnings.
Common vs. Preferred Stocks
There are two main types of stock: common and preferred. Common stock usually entitles the owner to vote at shareholders' meetings and to receive dividends. Preferred stock generally does not have voting rights, but has a higher claim on assets and earnings than the common shares. For example, owners of preferred stock receive dividends before common shareholders and have priority in the event that a company goes bankrupt and is liquidated.