Homonym: stock (Supply)
Stock represents ownership in a company. When you buy stock, you purchase a small piece of that company, which means you can benefit from its success. Companies issue stock to raise money for growth and operations. Investors hope that the value of the stock will increase over time, allowing them to sell it for a profit.
There are two main types of stock: common stock and preferred stock. Common stock usually gives shareholders voting rights and the potential for dividends, while preferred stock typically offers fixed dividends but no voting rights. Understanding these types can help investors make informed decisions.