Common stock is a form of corporateequity ownership, a type ofsecurity. The termsvoting share andordinary share are also used frequently outside of theUnited States. They are known asequity shares or ordinary shares in the UK and otherCommonwealth realms. This type of share gives thestockholder the right to share in the profits of the company, and to vote on matters ofcorporatepolicy and the composition of the members of theboard of directors.

The owners of common stock do not directly own any assets of the company; instead each stockholder owns a fractional interest in the company, which in turn owns the assets.^[1] As owners of a company, common stockholders are eligible to receivedividends from its recent or past earnings, proceeds from a sale of the company, and distributions of residual (left-over) money if it is liquidated. In general, common stockholders have lowest priority to receive payouts from the company. They may not receive dividends until the company has met obligations on anypreference shares it has issued, and they receive distributions in liquidation only after bondholders, creditors (including employees) and preference share owners have been paid. When liquidation happens throughbankruptcy, the ordinary shareholders typically receive nothing.

Since common stock is more exposed to the risks of the business than bonds or preferred stock, it offers a greater potential forcapital appreciation. Over the long term, common stocks tend to outperform more secure investments, despite their short-term volatility.^[1]

Owners of a company's common stock are entitled to rights that are enumerated in its articles, bylaws and applicable corporate law. These can include the right to vote on directors, officers, compensation plans and major business actions such as acquisition or dissolution. Many companies also allow them to submit and vote on proposals to amend the bylaws or to mandate actions by the board.Pre-emption rights andshareholder rights plans regulate the terms under which new shareholders can affect the interests of existing ones. Shareholders have the right to request access to the company's financial records, the list of shareholders, and other records that they legitimately require to fulfill their ownership duties.^[2]

Common/Equity stock is classified to differentiate it from preferred stock. Each is considered astock class, with different series of each issued from time to time such as Series B Preferred Stock. Nevertheless, using "Class B Common Stock" is a common label for a super-voting series of common stock.

Common stocks exist on both public and private markets, however the accessibility differs because onlypublicly traded companies may have common stock publicly listed. Some companies may for various reasons delist some or all of their shares from the public market and common stock may then be converted tolimited common stock, other stock or be liquidated altogether.^[3]

Common stockslistings may be used as a way for companies to increase theirequity capital in exchange for dividend rights for shareowners. Listed common stock typically comes in the form of several stock classes in order for companies to remain in partial control of their stock voting rights.Non-voting stock may beissued as a separate class.^[4]

• Capital surplus
• Common stock dividend
• Equity (finance)
• Share capital
• Shares authorized
• Shares issued
• Treasury stock