# Stocks

### What Are Stocks?

* **Stocks** represent shares of ownership in a company.
* When you own stock, you become a **shareholder**, which means you have a stake in the company’s success.
* Companies issue stock to raise funds for their operations and growth.

### Types of Stocks:

1. **Common Stock**:
   * Most common type of stock.
   * Shareholders have voting rights and can participate in company decisions.
   * Receive dividends (if declared by the company).
2. **Preferred Stock**:
   * Holders receive fixed dividends before common shareholders.
   * Usually no voting rights.
   * Considered a hybrid between stocks and bonds.

### How Stocks Work:

* Stocks are listed on **stock exchanges** (e.g., NYSE, NASDAQ).
* Exchanges track supply, demand, and prices of each stock.
* Buyers and sellers trade stocks through these exchanges.