Understanding Alphabet's Three Stock Classes

Alphabet Inc., the parent company of Google, offers three distinct classes of shares: Class A (GOOGL), Class C (GOOG), and Class B (not publicly traded). Class A shares provide voting power, giving investors the ability to participate in corporate decisions such as electing board members. This share class typically attracts institutional and individual investors focused on governance participation. On the other hand, Class C shares, which do not offer any voting rights, emerged from a stock split in 2014 to allow the company to raise capital while preserving control for its founders, Larry Page and Sergey Brin. These shares appeal to investors interested more in stock performance and price appreciation than governance. It's worth noting that Class B shares, held by insiders, grant 10 votes per share but are not available for public trading. The trading prices of GOOGL and GOOG share classes are often close, with GOOGL typically commanding a slight premium reflecting the voting benefits. This structure results in a unique market environment where the influence of stockholder governance varies based on the share class owned, altering investment strategies and priorities in Alphabet’s complex corporate landscape.