Definition:
Stockholders (Shareholders) are individuals, companies, or trusts, that own shares of a for-profit corporation. The individuals own a specific number of shares, which they each purchased at a specific price. The stockholders have invested their money to purchase these shares and they gain in two ways (1) through dividends paid on these shares due to the corporation's profits, (2) by selling their shares at a profit.
The rights of the shareholders are subordinated (placed under) the rights of bond-holders, so that shareholders lose the value of their shares if the corporation becomes bankrupt. Shareholders may also lose some or all of the value of their shares if the stock price is lower when they sell than the price when they bought.
