Investing in Common Stocks for Beginners-Part 1

It is important to learn some basic knowledge about what common stocks is, how many types of stocks have, what causes stock prices to change and many more.Common stocks are the most common form of stocks an investor will encounter in the financial market. It represents a certificate of ownership of a company. Here we will look at the two important features of common stocks  limited liability and liquidation rights.Limited Liability:Common stockholders have limited liability, in other words, their liability is limited to those stocks. They cannot be forced to pay anything out of their own money in the event of bankruptcy. They are fully protected against any financial obligations incurred by the organizations.Liquidation Rights:If a company goes bankrupt and liquidates all its assets, the common stockholders have the right to receive their share of sale proceeds. However they are the last to receive money after the creditors, bondholders and preference stockholders are paid.Please visit the relevant guide to learn more interesting stuff about stock market secrets and stock investment tips.