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what is difference between stock and dividend?
Stock basically implies your ownership in the company. If you own 1% ownership in a company, the value of your stake becomes equal to 1% of the valuation of the entire company. Dividends are basically disbursal of company's profits to its shareholders. By holding stocks of a company, you become eligible to receiving dividends proportional to your ownership in the company. Dividends though are not guaranteed, as the company may incur losses or the management may decide to use the cash for future growth instead of disbursing it to the shareholders. For example, let's say a company called ABC Inc, is listed on NYSE and has a total of 1 million shares issued. Let's say if you purchase 100 stocks of ABC, your ownership in ABC will become Let's say that the share price at the time of purchase was $10 each. Total Investment = Stock Price * Number of Stocks Purchased = $10 * 100 = $1,000 Now, let's say that the company declares a dividend of $1 per share. Then,  Dividend Yield = Dividend/Stock Price = $1/$10 = 10% If one has to draw analogy with other banking products, one can think of stock and dividend as Fixed Deposits (analogous to stock) and the interest earned on the Fixed Deposit (analogous to dividend).