Are stocks classified as assets or equity?
I'm finding conflicting answers.
http://www.investopedia.com/ask/answers/083115/are-stocks-real-assets.asp
http://www.investopedia.com/terms/e/equity.asp
>>1042766
Both.
>>1042768
What
>>1042768
Where do they show up on the balance sheet then?
When does it change from long term assets / investments over to common stock?
>>1042770
To you they represent an asset
To the company whose shares you hold they represent owner's equity
>>1042773
Same applies for bonds?
>>1042781
Don't know fuck all about bonds
I'd imagine it's a similar thing but it might be asset and liability instead of asset and equity.
if you are a company and you raised funds through YOUR COMPANY's equity, then it is on the equity side. For example, when a company IPO's they sell equity, and the cash they receive in exchange raises the ASSET side of their balance, and on the other side their EQUITY (note: if u dont understand balance sheets you wont understand this).
Conversely, if you are a bank or hedgefund or simply a company who owns shares of a SEPERATE company (like Yahoo! owning Alibaba stock), those appear as ASSETS on your balance sheet. They are equities but are on your assets in that they generate income for the holder.
They're equity, more specifically shareholders equity.
>>1042792
I understand that.
I've just been taught thus far that stock = equity and the concept of them being financial assets threw me for a loop.
That makes perfect sense.
