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Authorized shares

Also called: authorised shares

In one line

The maximum number of shares a company is legally permitted to issue under its charter.

In plain English

Authorized shares are the ceiling set in the company's legal documents. Not all are issued — the rest sit available for future grants and rounds.

If you were explaining it to a 5-year-old

It's the total number of toys the club is allowed to make, even if it hasn't made them all yet.

Why it matters when you sell

The gap between authorized and issued shares hints at room for future issuance and dilution around your stake.

Related terms

Issued sharesOutstanding sharesTreasury sharesFully diluted shares

Put it to use

Dilution calculator

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Sources

A general market-practice term. See how we define and source the glossary in our methodology. General information, not advice.

Educational information only — not financial, tax or legal advice, and not an offer to buy or sell any security. Definitions are general; your own documents and local law govern your situation. PrivateTechShares is independent and not a broker or marketplace.