Which investments represent ownership?

• A. T-Bill
• B. CD
• C. Puts
• D. Stocks

Answer: (D)

Owning part of a company means you hold equity in that company. Stocks are shares that represent this ownership; owning them makes you a partial owner and you may receive dividends and have potential influence through voting rights. T-Bills are short-term government debt, so you’re lending money to the government and earning interest, not owning any part of it. Certificates of deposit are bank deposits; you’re lending money to the bank for a fixed return, with no ownership stake. Puts are option contracts that give the right to sell stock at a set price, which are derivatives and do not convey ownership in the company. So the investment that represents ownership is stocks.