Ownership in a corporation is represented by what financial instrument?

Ownership in a corporation is represented by stock. When an individual buys shares of stock, they are acquiring a piece of ownership in that corporation. Stocks represent equity in the company, entitling shareholders to a portion of the profits, typically in the form of dividends, and allowing them to participate in decision-making processes through voting rights at shareholder meetings.

In contrast, bonds are debt instruments; they represent a loan made by an investor to a borrower (the corporation). Bonds typically provide fixed interest payments over time rather than ownership stakes. Options and warrants are types of derivatives that provide the holder with the right, but not the obligation, to buy or sell stock at a predetermined price within a specific timeframe. However, they do not confer direct ownership in the corporation itself until exercised to purchase shares of stock.