Stock indices to securities, and the owner of these stocks is given a percentage of the company’s assets and profits. They are planned based on the size of the stocks he owns in that company. These stocks are traded through buying and selling on global stock exchanges. These basic stocks are traded in most of the investment governorates that return For successful investors around the world, it has become easier to find brokers and deal with them in a simpler manner without the obstacles that began to discourage investment and trading in the economy. There are many types of stocks and this article will elaborate on them.
What are the types of stocks?
Investing in stocks is one of the most important paths to achieving financial success, so dealing in this type of investment is not difficult compared to other investments, so many people resort to paying attention to investing in them, and in the meantime, everyone notices that there are lists and categories that are referred to and discussed with reference. As stocks have different types in their divisions, each of them has its own sector and destination. The following is an explanation of the most important of these types:
Stocks ranked based on preference
This type can be divided into two main categories:
- Common stock
Ordinary stocks are the most common type of stocks and represent most of the stocks that individuals deal with, as this type refers to the ownership of a specific part of a company, so that investors or shareholders have the right to obtain proportional stocks of the value of any asset in the event the company is closed and its business is terminated. The advantage of this type of stocks is that it gives the owner of the stocks the possibility to obtain returns from the profits that are achieved and so on, but on the other hand, it poses a great risk in relation to the loss of the company. In the event of its loss, all the owners of the individual bear this loss together.
- Preferred Stock
On the other hand, preferred stocks give some shareholders an advantage over other common stock holders in the event the company is dissolved. Preferred stock holders have the possibility to obtain a certain amount different from common or common stock holders, and preferred stock holders receive dividend returns before others, so it is similar to an investment For this type of stocks, fixed-income bonds are dealt with, so it is not used much in companies, so most people prefer to deal with ordinary stocks to ensure that the principle of fairness exists and that there are no internal problems between the owners of the company because of the privileges.
Stocks classified according to the size of the capital
This classification can be called the classification of the total value of the value of the stockss of each class, or what is known as the market value of the stock.
1-large-cap stocks
These are stocks with a value of $10 billion or more that are treated as large-cap stocks.
2-Medium-cap stocks
They are stocks with a market capitalization of between 2 and 10 billion.
3-Small-cap stocks
They are stocks that are worth less than 2 billion.
Stocks ranked based on location
This classification is used to help distinguish local stocks from international stocks of a particular country. This type of classification refers to two basic types of stocks:
1- Local stocks
That pertain only to the economy of a specific country and the companies it contains, not international or global stocks.
2-International stocks
They are stocks that include all the economies of countries around the world, such as the stocks of multinational companies that have many locations and branches around the world.
It should also be noted that it cannot be considered that the company’s headquarters is what determines the type of stock, as some companies may be located in the United States of America while their sales are exclusively abroad.
Stocks classified according to purpose
1- Growth stocks
They are stocks in which investors tend to look for growth and the opportunity to expand, as well as for companies whose sales are constantly rising and at the right speed to increase their wealth.
2- Value Stocks
They are stocks in which investors tend to pay attention to the value of the stock and look at companies whose stocks are not considered expensive, meaning that these companies are large and well known and have grown as required, and they are a good option for investors who are looking for stability and want to stay away from risks.
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