Ownership and rights
A share represents an ownership interest in a company, with rights determined by its class and governing documents. Those rights may include voting and possible distributions, but they are not identical across all shares. A shareholder generally does not own a specific company building or bank balance directly. The investment's value depends on the business and the market's assessment of future outcomes, rather than a promise to repay the purchase price on a fixed date.
Why prices change
Company earnings, financing decisions, competition and management can affect expectations. Interest rates, economic conditions and investor sentiment also influence the price buyers and sellers accept. A strong business can still be a disappointing investment if expectations embedded in its purchase price are too high. Separate a view about the company from a view about valuation, and distinguish current evidence from assumptions about what could happen in the future.
Assess the downside as well
Shareholders can lose money if the price falls, and common shareholders may receive little or nothing if a company fails after other claims are paid. Dividends can change and should not be treated as a guaranteed income stream. Consider concentration, liquidity and the need to sell at an inconvenient time. Owning a share also differs from holding a derivative that references its price, so verify the instrument before assuming ownership rights.