Question

What is registered public stock? What is unregistered private stock? And what are the main differences

Answer 1

Registered public stock is available to be traded by the public. It is registered with the states and the federal government in order to be in compliance with the law.

Unregistered private stock is stock that has not been registered. It is not available for public trading. Also, it's privately held which means it is not available in the marketplace.

The main differences are registered public stock has a daily price, a liquid market, and many investors. On the other hand, unregistered private stock has no daily available price, is not publicly traded, and is owned by very few shareholders.

Answer 2

Registered public stock is a security that has to be registered first with the Securities and Exchange Commission before it can be offered to the public through an initial public offering (IPO).

Unregistered private stock is a security offered to the company's existing investors, employees, and other specific individuals. Because it is offered privately to a limited number of investors, it is not registered with the Security and Exchange Commission.

The main difference of these stocks are:
1) Registration with SEC - one is registered the other is not
2) Offering Target - one is to the public the other is to a private party.
3) Liquidation - in the event that you need money, public stock can easily be liquidated because it will only be offered back to the public whereas private stock liquidation must follow certain conditions imposed by the issuing company