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Here are the defining characteristics of shares:

  • decision-making and voting rights - owning shares of stock gives certain rights
  • limited liability for shareholders - ordinary shareholders are not personally liable for the debt of a company in the event of bankruptcy
  • loss absorption for other investors (i.e. debt) and creditors - in the event of a liquidation, shareholders only get back their money if there is anything left over after creditors have been settled
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Q: What are the defining features of shares?
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