Stock rights

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Bradley Kuehne
Bradley Kuehne's picture
Stock rights

Hi,

Could somebody explain "Voting Rights" to me? does it mean that if I buy 10 stocks i get a say in the company's business decisions?

thanks

Jason Pride
Jason Pride's picture

Hi Bradley,

There are a number of classes of stocks and each carries its own level of voting rights. Some may not carry any depending on the rights conveyed with the stock issue. Generally speaking, common stock that you would purchase on the open market will carry voting rights. Each stock gets one vote on each issue that the board poses in the annual meeting or via proxy, but you only get a say in the questions that the board chooses to bring to the shareholders. This usually involves voting for members of the board or other very high level decisions like that. A normal shareholder will not have access to provide input into the day-to-day operations of the company. In order to achieve this level of management attention you will need to purchase 5%-10% of the company stock at which point you will have management's direct attention.