Copyright

Ch 10: Understanding Equity Securities

About This Chapter

This chapter takes you through the somewhat complex topic of equity securities. As you complete each lesson, you will have increases your knowledge of various types of stocks, their rules, and their advantages.

Understanding Equity Securities - Chapter Summary

This engaging chapter begins by looking at definitions of types of stocks and how to identify them. Then you'll look at specifics of common stock, penny stocks, and preferred stock - including the definitions, formulas, and rules that apply to them being explained. By the end of the chapter, you should be able to:

  • Explain issuance, spinoffs, and stockholder rights for common stock
  • List transaction rules and SEC rules for penny stocks
  • Discuss types of preferred stock, their advantages, and stockholders' rights
  • Understand voting rights and restrictions in stock ownership
  • Describe electronic stock exchanges and auction markets
  • Understand the types and characteristics of non-U.S. market securities
  • Explain FINRA rules related to equity securities

Our professional instructors have designed this chapter to help you retain maximum information about equity securities. You may use as little or as much information from each self-paced lesson as you need. After completing each lesson, take the corresponding self-assessment quiz to make sure you are learning in an efficient manner.

11 Lessons in Chapter 10: Understanding Equity Securities
Test your knowledge with a 30-question chapter practice test
Types of Stocks: Definition & Identification

1. Types of Stocks: Definition & Identification

Many people own stock, although most investors likely don't think much about where that stock came from. In this lesson, we will discuss the origin of stock through IPOs and the many types of stock.

Common Stock: Definition, Issuance & Formula

2. Common Stock: Definition, Issuance & Formula

This lesson will provide you with a basic understanding of common stock, why and how companies issue stock, the potential for return on investment when investing, and how to calculate shareholder earnings.

Common Stock Transfers, Spinoffs & Stockholder Rights

3. Common Stock Transfers, Spinoffs & Stockholder Rights

All corporations are owned by common shareholders. That ownership comes with certain rights. As corporations grow and change, the ownership can change through new stock offerings, spinoffs and transfers.

Penny Stocks: Definition & Transaction Rules

4. Penny Stocks: Definition & Transaction Rules

In this lesson we will define penny stocks and explore the importance of the stock. We will also review basic transaction rules and the inherent risks of these transactions.

SEC Rules Related to Penny Stocks

5. SEC Rules Related to Penny Stocks

Penny stocks are an exciting investment for the small investor. The stocks are cheaper and there is always the chance that the stock price will increase dramatically - but the investor might lose all his money.

What is Preferred Stock? - Definition, Types & Advantages

6. What is Preferred Stock? - Definition, Types & Advantages

This lesson will define the hybrid investment security called preferred stock. The various types of preferred stocks will be explained and advantages of each will be explored.

Preferred Stockholder Rights

7. Preferred Stockholder Rights

Preferred stock is a class of stock considered equity, and the preferred stockholder has some rights that common stockholders do not have. This lesson discusses the features of preferred stock and its advantages and disadvantages.

Stock Rights & Warrants: Ownership, Voting Rights & Restrictions

8. Stock Rights & Warrants: Ownership, Voting Rights & Restrictions

What are the rights of stockholders of common stocks vs preferred stocks? This lesson will cover the differences and go over warrants and preemptive rights.

Electronic Stock Exchanges & Auction Markets

9. Electronic Stock Exchanges & Auction Markets

The lesson deals with the different types of stock exchanges prevalent today. Learn about auction markets, electronic exchanges and over-the-counter exchanges.

Non-U.S. Market Securities: Types & Characteristics

10. Non-U.S. Market Securities: Types & Characteristics

The lesson deals with foreign investments in US markets. Learn the various tools for investing in international markets such as ADRs, foreign equity, etc.

FINRA Rules Related to Equity Securities

11. FINRA Rules Related to Equity Securities

In this lesson, we will review FINRA rules related to equity securities as outlined in rules 2114, 2121, 2122, and 2124. There will be a short quiz following the lesson.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

Earning College Credit

Did you know… We have over 200 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.

To learn more, visit our Earning Credit Page

Transferring credit to the school of your choice

Not sure what college you want to attend yet? Study.com has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.

Support