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More glossary terms
- JOLTS (job openings and labor turnover survey)
- Earnings per share (EPS)
- Nasdaq composite
- Unit
- Value investing
Share class definition
A company’s board of directors can use share classes to grant certain rights and privileges to different shareholders, depending on the class of share they hold.
What is a share class?
Share classes enable a company’s board of directors to grant certain rights and privileges to different shareholders, depending on the class of share they hold. For example, a company might give some of its shares more voting rights than other classes of shares.
What are the different classes of shares?
There are a few different classes of shares, and the best way to explain them is through an example.
Alphabet – the company that owns Google – has class A, class B and class C shares. Class A shares have the ticker GOOGL, while class C shares have the ticker GOOG. The difference between the two is that GOOG shares (class C) have no voting rights, while GOOGL shares (class A) do.
Alphabet’s class B shares are held by company insiders and founders. They grant 10 votes for every share, and they aren’t bought or sold publicly.
Share classes that grant voting rights and other benefits – and which are available to the public – might sometimes trade at a premium compared to their non-voting counterparts, but this is often modest.
It’s important to say that not all companies have different share classes, and different share classes will grant different rights depending on the company. Not all class B shares will be closed to the public as with Alphabet’s class B shares for example. The exception here is class A shares, which are usually known as ‘common shares’.
Because of this, you should check whether the company you’re looking to buy shares in has different share classes, and the type of shares that you’d be buying.
Investing glossary
It's important you know
Capital at risk. All investing should be for the longer term. The value of your investments can go up and down, and you may get back less than you invest. Tax treatment depends on individual circumstances and may be subject to change in the future.
A 25% government penalty applies if you withdraw money from a Lifetime ISA for any reason other than buying your first home (up to £450,000) or for retirement, and you may get back less than you paid into your Lifetime ISA.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Payments you make into your pension won’t be accessible until the minimum pension age (currently 55, increasing to age 57 from 2028). Tax treatment depends on individual circumstances and may be subject to change in the future.
For Business Saver: T&Cs apply. Max one withdrawal per day.