(If required, answers may assume I am asking about the situation in the US)

Where does stock ownership ultimately mean if we ignore middle men like brokers. Does the company itself keep a record of who owns what and is that the legal source for ownership questions? That would feel like a conflict of interest. Or is stock ownership entered in some public database? (Is that what DTC is for?) Or is stock ownership completely decentralized and immaterial and is simply based on some numbers that I am given in legally binding documents at the time of purchase that I can then use to argue in front of a court if my ownership is ever disputed?

Related to this question, how do I transfer ownership? If I buy stock and the company later says they do not have me in their records, do any documents that I received count to prove ownership? This has even more relevance if I did buy through a broker. What if the broker went bankrupt? There must be an actual ownership beyond being listed in some books of some broker, right?

If I want to sell my stocks to, say, a friend, how do I transfer ownership to him? Do I have to inform the company? This would feel strange; if I buy a computer I don't need to inform the store I bought it from when I sell it to a friend. I imagine I should just be able to hand my original letters of purchase to my friend together with a new document in which endorse the trade?

  • Did you do any research?  – Aganju Nov 8 '18 at 23:01
  • Your questions have very practical answers. There are regulations around stock sales and there are entities that maintain ownership records. Unless you can narrow down your question more I'm voting to close as unclear what you're asking. – D Stanley Nov 8 '18 at 23:08
  • @DStanley I didn't want to hear "brokers take care of that for you", or "transfer agents take care of that for the company", but I removed that part to avoid having the question closed – Bananach Nov 8 '18 at 23:20
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    @Bananach See if this link or this link help. – D Stanley Nov 8 '18 at 23:22
  • @DStanley this is exactly the kind of partial information that made me ask this question. For example, the link doesn't say who maintains the shareholder register, whether they are legally obliged to do so, whether the information in the register is legally binding for ownership questions or simply exists for communication purposes, how the information is updated in case I sell my shares, ... Also this seems to contradict the answer by Aganju saying that 'typically, there is no registration at all' – Bananach Nov 8 '18 at 23:26

Typically, there is no registration at all, and non is necessary.

You buy stock through a broker, and the broker holds them in your account, same as your bank holds your money in your checking account. If the broker would make your shares disappear, he is responsible; the same way your bank is responsible if your money disappears.

Except for name shares, the issuing company is not the least interested in who owns their shares, and has no record of it. Millions of shares change ownership every day multiple times. Note that you are required to publish if you own more than a certain percentage of the shares of any company.

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  • The company may not care about your identity, but they certainly need to know it for dividends, shareholder meetings, proxy vote notices, etc. – D Stanley Nov 8 '18 at 23:20
  • Can we ignore brokers? Talking about them just shifts the question: Who keeps track what brokers own? By the way, to answer your question in the comments above, I did do some research, but I found most information incomplete and relating to brokered purchases and just not concrete enough. – Bananach Nov 8 '18 at 23:31
  • Also, does your first sentence contradict the link posted by DStanley in the comments? investopedia.com/terms/s/shareholder-register.asp – Bananach Nov 8 '18 at 23:31
  • The link explains what a shareholder register is. It doesn't claim or imply that every company has one; most don't. I mentioned the 'name shares' which do track ownership that way. – Aganju Nov 9 '18 at 2:51
  • @Bananach Some info on who keeps tracks on brokers is in my answer to How to check I own a stock not involving a broker. – TripeHound Nov 9 '18 at 7:51

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