Common rights of an investor

The common rights of investors are enumerated below:

1. Voting Power

This power includes electing directors, which takes place at the company's meeting annually. Voting for proposals for fundamental changes affecting the company such as liquidation or mergers is also a part.

2. Ownership

Common investors own a piece of a portion of the Company that has value, when business thrives. In other words, they have a claim on a portion of the assets owned by the company.

3. Transfer Ownership

Investors are allowed to trade their stock on an exchange that is they can exercise the right to transfer ownership. Although it might seem mundane, but the liquidity provided by stock exchanges is extremely important. As stocks are so liquid, it is very easy to move your money into other places instantaneously.

4. Dividend Entitlement

Investors have a right to claim any profits a company pays out in the form of a dividend, along with a claim on assets. A company management has two options with profits: reinvest them back into the firm or pay out in the form of a dividend. The board of directors decides on what percentage of profits should be paid out.

5. Inspect Corporate Books and Records

The investor can avail this opportunity provided through a company's public filings, including its annual report. Today, it’s not a big deal as public companies are required to make their financials public.

6.Suing

Suing a company for wrongful acts usually takes the form of a shareholder class-action lawsuit. Giving shareholders and investors an inaccurate view of its financial health by a company can be sued upon.

Inventor’s rights vary from state to state, and country to country. Check with your local authorities for the latest information and standard for the purchase of any common stock. The common rights of investors are very important for the protection of shareholders against poor management and wrong actions or inactions of the existing set of officers and directors.