Auto Financing

A specific example of corporate finance is the sale of stock by a company to institutional investors like investment banks, who in about-face generally sell it to the public. The stock gives whoever owns it component ownership in that company.

If you buy only share of XYZ Inc, and they have 100 shares outstanding (held by investors), you are 1/100 heiress Auto Financing of that company. Of course, in return for the stock, the collection receives cash, which it uses to expand its work in a movement called "equity financing". Equity financing mixed with the sale of bonds (or any other deficit financing) is called the company's capital structure.