Shares

Loading the player...

DEFINITION of 'Shares'

A unit of ownership interest in a corporation or financial asset. While owning shares in a business does not mean that the shareholder has direct control over the business's day-to-day operations, being a shareholder does entitle the possessor to an equal distribution in any profits, if any are declared in the form of dividends. The two main types of shares are common shares and preferred shares.

BREAKING DOWN 'Shares'

In the past, shareholders received a physical paper stock certificate that indicated that they owned "x" shares in a company. Today, brokerages have electronic records that show ownership details. Owning a "paperless" share makes conducting trades a simpler and more streamlined process, which is a far cry from the days were stock certificates needed to be taken to a brokerage before a trade could be conducted.

While shares are often used to refer to the stock of a corporation, shares can also represent ownership of other classes of financial assets, such as mutual funds.

RELATED TERMS
  1. Equity

    Equity is the value of an asset less the value of all liabilities ...
  2. Shareholder

    Any person, company or other institution that owns at least one ...
  3. Blue Chip

    A nationally recognized, well-established and financially sound ...
  4. American Depositary Receipt - ADR

    A negotiable certificate issued by a U.S. bank representing a ...
  5. Overallotment

    An option commonly available to underwriters that allows the ...
  6. Paired Shares

    The stock of two separate companies that are under the management ...
Related Articles
  1. Stock Analysis

    The 3 Best Stocks to Buy and Hold and Never Let Go

    Learn about the characteristics, qualities and reasoning behind stocks suitable for an investor interested in a buy-and-hold forever portfolio.f
  2. Investing Basics

    What is a Share?

    A share – also called a stock -- is a unit of ownership in a corporation or financial asset.
  3. Investing Basics

    Knowing Your Rights As A Shareholder

    We delve into common stock owners' privileges and how to be vigilant in monitoring a company.
  4. Active Trading

    Random Reinforcement: Why Most Traders Fail

    This phenomenon can cause a trader to abandon a proven strategy or risk everything on chance. Find out how to avoid it.
  5. Products and Investments

    There's a Reason They're Called Junk Bonds

    The closing of Third Avenue Managemet's Focused Credit Fund is a warning to investors and advisors. Beware the junk.
  6. Mutual Funds & ETFs

    Top 3 PIMCO Funds for Retirement Diversification in 2016

    Explore analyses of the top three PIMCO funds for 2016 and learn how these funds can be used to create a diversified retirement portfolio.
  7. Mutual Funds & ETFs

    The 3 Best Downside Protection Equity Mutual Funds

    Learn how it is possible to profit in a bear market by owning the correct selection of mutual funds that provide downside protection and opportunity.
  8. Mutual Funds & ETFs

    The 4 Best Lord Abbett Mutual Funds

    Discover the four best mutual funds administered and managed by Lord, Abbett & Co., LLC that offer investors a wide variety of investment strategies.
  9. Mutual Funds & ETFs

    The ABCs of Mutual Fund Classes

    There are three main mutual fund classes, and each charges fees in a different way.
  10. Mutual Funds & ETFs

    The 3 Best Vanguard Funds for Value Investors in 2016

    Find out which of Vanguard's value funds are the best for building a solid core-satellite value investing strategy for your portfolio.
RELATED FAQS
  1. What level of dividend yield can be expected from companies in the drugs sector?

    The drugs sector includes drug delivery (with a dividend yield of 0.09%), drug manufacturers - major (with a dividend yield ... Read Full Answer >>
  2. What is the difference between share purchase rights and options?

    There is a big difference between share purchase rights and options. With share purchase rights, the holder may or may not ... Read Full Answer >>
  3. Do stock splits and stock dividends affect stockholder equity?

    Stockholders' equity represents the capital portion of a company's balance sheet. The stockholders' equity can be calculated ... Read Full Answer >>
  4. What's the difference between a merger and a hostile takeover?

    The difference between a merger and a hostile takeover has to do with the manner in which two companies merge to become a ... Read Full Answer >>
  5. What is the doctor advisory scam?

    U.S. securities law provides certain exemptions that allow privately owned companies to issue shares of unregistered stock ... Read Full Answer >>
  6. What does it mean when someone says that a stock went up X points? Does this refer ...

    For stocks, one point equals one dollar. So when you hear that a stock has lost or gained X number of "points", this is the ... Read Full Answer >>
  7. Is there a maximum amount of stock an individual investor or corporation can purchase?

    There are two answers to this question. The short answer is that there is no limit to the number of shares one entity may ... Read Full Answer >>
  8. I want to invest in equities, but I don't have much money. Is there a minimum number ...

    The short answer is "no" - you can buy a single share of any publicly traded company if you want to. Thus, if you have a ... Read Full Answer >>
Hot Definitions
  1. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
  2. Discouraged Worker

    A person who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment ...
  3. Ponzimonium

    After Bernard Madoff's $65 billion Ponzi scheme was revealed, many new (smaller-scale) Ponzi schemers became exposed. Ponzimonium ...
  4. Quarterly Earnings Report

    A quarterly filing made by public companies to report their performance. Included in earnings reports are items such as net ...
  5. Dark Pool Liquidity

    The trading volume created by institutional orders that are unavailable to the public. The bulk of dark pool liquidity is ...
Trading Center