A shareholder, also known as a stakeholder, can be either a natural person or a legal person that holds stocks in a company. A shareholder owns a minimum of one share in a company or a mutual fund, making them a partial owner. There are two types of shareholders: common and preferred.
Common shareholders are those that own a company's common stock. They are the most prevalent type of stockholders, and they have the right to vote on matters concerning the company.
Preferred shareholders, on the other hand, are less frequent. Unlike common shareholders, they own a share of the company's preferred stock and have no voting rights or say in managing the company. Instead, they are entitled to a fixed amount of annual dividends, which they will receive before the common shareholders are paid their part.