The term stock refers to a set of fully paid-up shares legally consolidated or put together in a bundle. Stock is therefore the capital in the form of a fund which may be divided into any desired amount. A company limited by shares, may, if so authorized by its articles of association, convert all or some of the fully paid up shares into stock or reconvert its stock into fully paid up shares of any denomination. With the conversion of shares into stock, the identity of each of the shares is lost. The aggregate can be split up into fractions of any amount without regard to the original nominal amount of shares. A company cannot issue stock directly but can convert only fully paid-up shares into stock. The issue of partly paid-up stock is invalid.

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