What is the Difference Between Stock and Reserves?

By Shivank Goel|Updated : September 5th, 2022

The difference between stock and reserves is that stocks refer to such materials that possess the capability to satisfy the user's demands but are not being utilized due to various reasons such as lack of technology and innovation.

Reserves, on the other hand, are materials that are well recognized in their quantity and capability and, despite technological availability, are not being utilized at present and have been reserved for future purposes.

Water is a good example of a stock that contains hydrogen and oxygen, which are two inflammable gases that can be used for various energy sources but are not being utilized due to a lack of technology.

Differences between Stock and Reserves

Stocks

Reserves

Materials/elements that possess potential but can not be accessed.

Resources that can be used but are not being accessed due to several future reasons

Water and minerals found in the sea or oceans are a few examples

Forests and reservoirs are some examples

Common and Preferred Stock are two main types

Capital, revenue, statutory, realized, and unrealized reserves are few used in financial accounting

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FAQs

  • Water is a good example of a stock that contains hydrogen & oxygen, two inflammable gases that can be used for various energy sources but are not accessed due to lack of technology.

  • Capital, revenue, statutory, realized, and unrealized reserves are a few reserves used in financial accounting.

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