An activist investor is a someone who buys many shares in the same company in order to influence how it is managed. For example, if you think that McDonald’s would be more successful if it sold tuna Hamburgers, you could buy 20% of McDonald’s shares and become the majority shareholder. You now have the upper hand (a whopping 20% of the company) and the right to tell the Board of Directors that McDonald’s should sell tuna hamburgers. Two months later, the McTuna shows up on their menus. You are an activist investor.
If a company was an apple pie, a stock would be a slice of the pie. In short, a stock is a slice of a company. Everyone who owns a piece of a company has the right to share a portion of the profits of the company. Read more