Ordinary Shares
Definition of 'Ordinary Shares'Any shares that are not preferred shares and do not have any predetermined dividend amounts. An ordinary share represents equity ownership in a company and entitles the owner to a vote in matters put before shareholders in proportion to their percentage ownership in the company.Ordinary shareholders are entitled to receive dividends if any are available after dividends on preferred shares are paid. They are also entitled to their share of the residual economic value of the company should the business unwind; however, they are last in line after bondholders and preferred shareholders for receiving business proceeds. As such, ordinary shareholders are considered unsecured creditors. Also known as "common stock". |
|
Investopedia explains 'Ordinary Shares'Ordinary shares include those traded privately as well as shares that trade on the various public stock exchanges. Ordinary shares have a stated "par value", but this value is more of a technicality, and will rarely be more than a few pennies per share. The true value of an ordinary share is based on the price obtained through market forces, the value of the underlying business and investor sentiment toward the company. |
Related Definitions
Articles Of Interest
-
Knowing Your Rights As A Shareholder
We delve into common stock owners' privileges and how to be vigilant in monitoring a company. -
Stock Basics Tutorial
If you're new to the stock market and want the basics, this is the tutorial for you! -
Guide To Embedded Options In Bonds
Investors should be aware of embedded options that may be available in certain securities as these options may affect the value of the security. -
Visual Guide To Investing In Preferred Stock ETFs
Preferred stock ETFs have become a big hit with some investors. Find out why! -
The Riskiest Investment Moves for Retirement That Could Pay Off
Before incurring additional risks in your retirement portfolio, be sure to understand the alternatives and the consequences of your strategy. -
$1 Salaried CEOs Making Millions
Some CEOs who are paid $1 annually are actually among the highest-paid when all forms of compensation are taken into account. -
How Will Your Investment Make Money?
Discover the basic types of investment income and which asset classes pay them. -
How To Live Off Your Dividends
One way to enhance your retirement income is to invest in dividend paying stocks and mutual funds. -
A Primer On Preferred Stocks
Offering both income and relative security, these uncommon shares may work for you. -
Introduction To Convertible Preferred Shares
These securities offer an answer for investors who want the profit potential of stocks but not the risk.
Free Annual Reports