How does it work in Torchlight 2? Is the shared stash just for my characters? I don't want to put things in there because I'm worried if I play online other players online could jack my loot.

Yes, if you play a multiplayer game anybody else in the game can take things from the shared stash; that's what it's there for. However, you too can take things other players have put into the shared stash, so in the long run, it balances out. If that bothers you, your best bet is to go over your shared stash before joining a multiplayer game and take out anything you're not willing to lose. If you really need extra space, start a new game, play it until you've reached the Estherian Enclave and move those items to the new character's private stash before entering the other game with your main character.

Good call, thanks!

That is 100% false. It is only shared between your own characters.