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There are several types of stocks to consider:

Common Stock

This is the most common form of stock an investor will encounter.
Anyone can own common stock since there are no restrictions on who can purchase it
Common stockholders have the last claim on assets if the company dissolves after bondholders, other creditors, and preferred stockholders.

Preferred Stock

A company must pay dividends to its preferred stock shareholders before it can pay any  dividends to its common stockholders.  If a company goes bankrupt, preferred stockholders' claims on the company's assets are considered before those of the common shareholders.

 


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