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Stock
 

 

When used in connection with the capital of a company, stock is similar to, but not synonymous with, share capital. Shares may be converted into stock only when they are fully paid. Being so converted, they lose their identity as individual units and become merged into an aliquot part of total equity capital. The advantage of converting shares into stock is that transferability is made easier, in so far as capital can then be bought or sold in monetary quantities not bound by the nominal value of individual shares.

The term ‘stock’ is also used with reference to interest-bearing government securities, frequently described as loan stock, and to any capital issued in parcels rather than defined units. Distinguish from stock-in trade.


Reference: The Penguin Business Dictionary , 3rd edt.