Which of the following statements regarding bonds and stocks is correct?

The assertion that stockholders own shares while bondholders do not is accurate because it highlights the fundamental difference in ownership rights and claims between the two types of securities. When an individual purchases stocks, they acquire an equity stake in the company, which means they are part owners. This ownership grants stockholders certain rights, such as voting rights in corporate decisions and the potential to receive dividends based on the company's profitability.

In contrast, bondholders are lenders to the company. They purchase bonds, which are essentially loans that the company agrees to repay with interest over a specified period. Bondholders do not have ownership in the company and thus do not enjoy rights that come with equity ownership, such as participating in ownership decisions or receiving dividends that are contingent on the company's financial performance.

This distinction is crucial in understanding the different roles that stocks and bonds play in the financial landscape, as well as how they can impact an investor's portfolio and risk exposure.