In investing, a security representing a small ownership claim in a company is called stock.
A corporation can divide its ownership into shares. Someone who owns shares may be called a shareholder or stockholder. Depending on the class of shares and the company’s rules, ownership can provide voting rights, eligibility for dividends, or a claim on remaining assets after creditors if the company is liquidated.
Stock differs from a bond. A bond is generally a debt obligation: the issuer borrows money and promises payments under stated terms. A stockholder is an owner rather than a lender, so stock returns can come from price changes and dividends but are not guaranteed.
Public-company shares can trade on stock exchanges, while private-company shares may be difficult to sell. Stock prices can rise or fall because of company performance, economic conditions, interest rates, investor expectations, and market sentiment. Owning one stock therefore does not automatically provide diversification.