| For many first time investors the most difficult task | | | | directors. |
| to learn before trading stocks is trying to learn what | | | | Additional classes of stock include Class A and Class |
| the different type of stocks are in the market. This | | | | B stock. Each of these classes of stock provide the |
| lack of investing knowledge can result in many novice | | | | investor with voting rights but the Class A stock |
| investors making poor investment choices or avoiding | | | | provides the stock owner or investor more votes |
| the stock market all together. The fact is, if you | | | | per share then the owner of the Class B stock. |
| intend to make money trading stocks you must | | | | These types of stocks, which have been in |
| know what types of stocks are available. | | | | existence since 1987, are not classified as common |
| An investing term you will hear mentioned frequently | | | | stocks and many investors that are starting out |
| is Common Stock. This term relates to a stock that | | | | usually avoid these stocks. |
| any potential investor can invest in regardless of | | | | For the more experienced investor, the Preferred |
| income, age, financial status or location. This form of | | | | stock is the typical choice but it isn't exactly a stock. |
| stock allows you the opportunity to become a part | | | | In fact, it's more of a combination of a bond and |
| owner of the business you are investing in. As the | | | | stock because the owner can stake a claim against |
| company becomes more valuable the stock rises in | | | | the assets of the company should it go into |
| value. However, if the company starts to make bad | | | | bankruptcy. Additionally, preferred stock holders |
| decisions, performs poorly or approaches bankruptcy | | | | always receive compensation from a company |
| the value of your stock decreases rapidly. As a | | | | before the common stock holders. One minor |
| common stock holder you have no say in the day to | | | | disadvantage involves the right of the company to |
| day operations of the business but you can place a | | | | repurchase the preferred stock back from the |
| vote when it comes time to elect a board of | | | | investor and cease to pay dividends. |