General Information: Shareholders & Stock Transfer Companies

Every Corporation that issues stock has a stock transfer company (also known as a transfer agent). Although some companies keep their transfer services in house, most outsource the responsibility to a transfer agent like Colonial Stock Transfer that exclusively handles the job. Colonial Stock Transfer services companies world wide.

Generally, a transfer agent's job is to keep records and issue new certificates for shareholders of corporations when needed. Transfer Agents may also send out shareholder mailings for corporations, tabulate shareholder votes for annual and special meetings, and provide several other specialized services for both public and private corporations.

So what's the difference between a transfer agent and a stock brokerage firm?  Stockbrokers provide services for individual investors - not the corporations that issue stock. In most cases it is necessary for shareholders to go through their broker for their financial needs. Stockbrokers can liquidate investments and provide individuals with a host of other financial services - but they can't issue actual stock certificates.

Stock transfer agencies simply provide services to the corporations who issue the actual stock. Most individuals purchase shares through their broker, which will be held electronically with the brokerage firm. If you have purchased shares directly from the company or from a company insider your shares are typically held in certificate form.  When free trading shares are deposited into your brokerage account, the firm automatically converts the shares to "street name", which means the shares are held electronically on your behalf.