Simple English definitions for legal terms
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Common-Stock Equivalent: A type of investment that can be exchanged for common stock, which means it is considered the same as owning common stock. Examples of common-stock equivalents include things like convertible securities, stock options, and warrants.
COMMON-STOCK EQUIVALENT
A common-stock equivalent is a type of security that can be exchanged for common stock, and is therefore considered to be the same as common stock. This includes convertible securities, stock options, and warrants.
These examples illustrate how common-stock equivalents can be exchanged for common stock, and therefore have similar value and characteristics as common stock.