equity security


An instrument that signifies an ownership position (called equity) in a corporation, and represents a claim on its proportional share in the corporation's assets and profits. Ownership in the company is determined by the number of shares a person owns divided by the total number of shares outstanding. For example, if a company has 1000 shares of stock outstanding and a person owns 50 of them, then he/she owns 5% of the company. Most stock also provides voting rights, which give shareholders a proportional vote in certain corporate decisions. Only a certain type of company called a corporation has stock; other types of companies such as sole proprietorships and limited partnerships do not issue stock. also called equity or stock or corporate stock.

Use equity security in a sentence

You should try to make sure that you do a lot of research when deciding which equity security to use.

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We had plenty of equity security and it made us feel very good about ourselves and made us very happy.

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Pax knew that the equity security that had been approved was far and away a great investment and he was confident that his ownership would cause great returns.

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Clearing House Electronic Subregister System (CHESS) face value