How does a company become a publicly traded company?

Every share available for purchase in the stock market is issued by a publicly traded company. A company generally becomes publicly traded by making an initial public offering (IPO) of shares in the company, which helps it raise capital. The IPO process gives both investors and the company a powerful way to create wealth.

What is a public company?

A public company, also called a publicly traded company, is a corporation whose shareholders have a claim to part of the company's assets and profits. Ownership of a public company is distributed among general public shareholders through the free trade of shares of stock on stock exchanges or over-the-counter (OTC) markets.

What are examples of public companies?

Examples of public companies include Chevron Corporation, McDonald's, and The Procter & Gamble Company. A company must meet certain requirements to complete an IPO, both regulations set forth by the regulators of the stock exchange where it hopes to list its shares and those set forth by the SEC.

Are publicly traded companies leading the way in innovation?

These publicly traded companies are leading the way in innovation. Publicly traded companies are a key component of the American economy, allowing anyone to own shares and earn a profit. Shares are bought and sold on any number of stock exchanges — the New York Stock Exchange and Nasdaq are the most prominent in the United States.