What Is the Difference Between Authorized Stock and Issued Stock?
Authorized stock and issued stock are terms used to describe the disposition of the total number of shares representing the overall ownership of a given company. When a corporation files its charter with the state in which it is incorporated and applies to the SEC to allow trading in the corporation’s stock, the corporation is authorized a total number of shares that represents the ownership of the company. The company then issues (sells) a portion of that authorized stock to the public, and trading in the stock begins.
