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Common shareholders typically enjoy six main rights.

  1. They have voting power on major issues
  2. They own a portion of the company
  3. They can trade their stock on an exchange
  4. They can take dividends
  5. They can inspect corporate books and records
  6. And they have the right to sue for wrongful acts

When it comes to corporate bankruptcy, however, there is a pecking order to the three main classes of securities: bonds, preferred stock and common stock. When a company goes belly up, creditors get first dibs on its assets. If any assets remain, bondholders get the next crack, followed by preferred shareholders, then common shareholders.

But things aren’t all bad for common shareholders. When a company turns a profit, they gain, too. Their exposure to share price appreciation comes with the potential for greater reward, as well.

In addition, companies issue a shareholder rights plan that outlines the rights a stockholder has with a specific company. These plans typically give the board of directors the power to protect shareholders in case an outsider tries to assume control of the company through a hostile takeover.

Other perks may include free beer that comes with stock in a big brewer, or free phone cards for buying shares in the likes of AT&T. McDonald’s has been known to offer free fries, and Starbucks gives shareholders free cups of coffee.

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