web3/concepts/stock.md

Stock

A type of security which grants buyers access to income-cashflows in a common economic enterprise.

Stocks are valued by the market as a combination of three factors which inform price formation:

1. Discounted future cash flows
2. Momentum
3. Public sentiment

Stocks return income-cashflows generated by the enterprise to shareholders via three processes:

1. Dividend payments
2. Stock buybacks
3. Mergers and Acquisitions