What is a "Stock or Share" of a Company & How Can I Buy One : An Entrepreneur's Journey pt 49

Stock is the capital raised by a business or corporation through the issue and subscription of shares. You’ve probably heard a popular definition of what a stock is: “A stock is a share in the ownership of a company. Stock represents a claim on the company's assets and earnings. As you acquire more stock, your ownership stake in the company becomes greater.” Unfortunately, this definition is incorrect in some key ways. To start with, stock holders do not own corporations; they own shares issued by corporations. But corporations are a special type of organization because the law treats them as legal persons. In other words, corporations file taxes, can borrow, can own property, can be sued, etc.

The idea that a corporation is a “person” means that the corporation owns its own assets. A corporate office full of chairs and tables belong to the corporation, and not to the shareholders. This distinction is important because corporate property is legally separated from the property of shareholders, which limits the liability of both the corporation and the shareholder. If the corporation goes bankrupt, a judge may order all of its assets sold – but your personal assets are not at risk. The court cannot even force you to sell your shares, although the value of your shares will have fallen drastically. Likewise, if a major shareholder goes bankrupt, she cannot sell the company’s assets to pay off her creditors.

Let me explain....

You can see all of my videos on PushYourRank's YouTube Channel as soon as I post them.  I repost the videos here to give you more context into what I was thinking and maybe what I was going through that day that might be relevant.  Again my goal with these videos is to document what I have learned from entrepreneurship.  Follow me on twitter @NicholasCoriano