What is the difference between a stock, share and stake?
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Stock is just a way to split up the ownership of a company. A company could, for example, split up their ownership into 1000 pieces. Each of those pieces is a ‘share’ of the company’s stock. A ‘stake’ means you have some reason to want the company to do well.
Apple’s stock, as a whole (as in, all of the shares of Apple stock) is listed as ‘AAPL’. One share of AAPL basically means you own one tiny, tiny piece of the company. You don’t own ALL of Apple’s stock, you just own your one share (or however many shares you purchase).
Your ‘stake’ in Apple is just how much interest you have in seeing the company do well or not do well. If you own shares of Apple stock, you have a stake in seeing Apple do well, since your stock will go up if Apple makes more money than expected. If you own $5000 worth of Apple shares, you have a $5000 stake. You can also express stake as a percentage of the total, so if you own 500 shares in a company that has 1000 total shares, then you have a 50% stake in the company (meaning you own half the company).
A share is a unit of stock. , ie “I bought 100 shares of Apple stock.” A stake is usually a term used for a percentage of ownership, like “Fidelity controls a 5% stake in Apple through ownership in its many mutual funds”
Do you mean “stock option” when you say “stock”?
They are almost completely synonymous, unless you are being very picky. I own a share of stock and therefore have a stake in the company. Although “Stake” usually refers to a much larger number of shares of stock and is usually represented as a % ownership in the company in question.
They are increasingly general terms for the same type of thing.
Having a stake in something means you have some (typically financial) interest in its performance. That might be owning stock in a company, but maybe it’s referring to the fact that you bet $5 on a football game.
A share is a piece of ownership of…something. Again, this might be a stock, but you can also own a share of a mutual fund or an investment property or whatnot. So a stock is a share and a share is a stake, but not all stakes are shares and not all shares are stocks.
Finally, a stock is specifically a piece of ownership of a company.
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