Share - Financial definition
Concise definition of the term share
A share is a certificate which represents a right of ownership in a company. If confers its owner a number of rights, the most prominent of which being the right to take part in the decisions affecting the company by voting, and to be attributed a share of the company's profit.
Comprehensive definition of the term share
In finance, a share is a unit of ownership in a corporation, also known as a stock, representing a proportional claim on the company's assets and earnings. Shareholders are entitled to dividends when the company distributes profits and have the right to vote on important corporate matters, such as the election of the board of directors or major business decisions, during shareholder meetings.
Shares are typically bought and sold on stock exchanges, where their prices fluctuate based on supply and demand dynamics, as well as company performance and market conditions. For example, an investor purchasing shares of a publicly traded company like Apple or Google becomes a partial owner of that company and stands to benefit from its financial success through potential capital appreciation and dividend payments.
Share or stock?
The term stock is generally used to describe the ownership certificates of any company, while share refers to the ownership certificates of a particular company.
Thus, an investor would say that he owns stocks when talking about his investments in general and that he has bought Apple shares when talking about his investment in a specific company.
This distinction is reflected in the terms “stockbroker” and “shareholder”. A stockbroker deals in shares in general, the term shareholder, however, is generally used when talking about owners of shares of a specific company.