Beneficial owner

A beneficial owner is an entity that owns stock or other property that is registered in the name of another party. The beneficial owner enjoys the income from the owned asset. If the asset is stock, the beneficial owner has the right to vote or sell these shares. This situation typically arises when investors leave securities in trust with their brokers. The broker then appears to be the owner of record, with the beneficial owner hidden behind the broker. This arrangement is usually for convenience, but it can also provide a certain degree of anonymity for the beneficial owner. Beneficial owner arrangements are usually legal, though they may be closely regulated.

Related Courses

Corporate Finance 
Investor Relations Guidebook 
Public Company Accounting and Finance