STOCKHOLDERS Meaning and
Definition
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Stockholders, also known as shareholders or equity holders, are individuals, organizations, or entities that own shares or stocks in a corporation or company. They are the legal owners of the company and have a claim on its assets and earnings. Stockholders collectively represent the ownership of the corporation and play a crucial role in decision-making processes.
Stockholders typically acquire shares by purchasing them from the company through an initial public offering (IPO) or through trading on the stock market. By investing their capital, stockholders profit from the company's success through dividends and capital appreciation.
As owners, stockholders have certain rights and privileges. They have the right to receive dividends when declared by the company's board of directors and also have voting rights, which allows them to participate in major decisions such as the election of the board of directors and approval of corporate policies.
Stockholders assume a degree of risk in their investment since their returns are subject to market fluctuations and the company's performance. However, they also have limited liability, meaning that their personal assets are protected from the company's financial obligations beyond their invested amount.
In summary, stockholders are the owners of a corporation who hold shares or stocks representing their ownership interest in the company, entitling them to certain benefits, such as dividends and voting rights, while also bearing the risk and enjoying limited liability in their investment.
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Other Common Misspellings for STOCKHOLDERS
Etymology of STOCKHOLDERS
The word "stockholder" has a relatively straightforward etymology. It is derived from the combination of two words: "stock" and "holder".
1. Stock: The term "stock" originally comes from the Old English word "stoc", which referred to a tree trunk or a post used for support. Over time, it came to represent ownership shares in a company or corporation. This usage began in the 16th century when companies started issuing ownership certificates that were often called "stocks".
2. Holder: "Holder" is derived from the Old English word "haldan", which means "to have, to hold". It denotes someone who possesses or owns something.
Therefore, when the two words are combined, "stockholder" refers to a person who holds or owns stocks/shares in a company or corporation.
Similar spelling words for STOCKHOLDERS
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