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What is a a Common Stock or Equity Stock?

An Equity Stock is a part of the total capital of a joint stock company represented in the form of shares. Shares are issued by a company for raising capital required for running the business. Shareholders are owners of a joint stock company.

The book value of a share is the original price of a share when it was issued and does not change normally. It is also called Par Value.

The market value of a share is the price at which it trades in the Stock Exchange on any given day.

In the US, a common stock of a publicly traded company is allocated a symbol in the stock exchange it is trading in. For example, the stock symbol allocated to the common stock of Microsoft Corp is MSFT in the NASDAQ Stock Exchange.

Predominantly, common stocks are traded in stock exchanges around the world.


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