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What is a Preferred Stock?

A Class of ownership in a corporation that has a higher claim on the assets and earning that common stock. Preferred stock generally has a dividend that must be paid out before dividend to common stockholders and the shares usually do not have voting rights.

What is a Preferred Dividend?

A dividend that is accrued and paid on a company’s preferred shares. In the event that a company is unable to pay all the dividends, claims to preferred dividends take precedence over claims to dividends that are paid on common shares. Preferred stock will typically pay much higher dividend rates than common stock of the same company. This is the main benefit of owning preferred shares.

Where do I find companies that offer Preferred Stock?

There are thousands of Preferred Stocks in North America to choose from, which can be overwhelming. Use Preferred-Stock.com’s tools to help screen, track, calendar search and locate your Preferred stock selections.

Aren’t there other service providers that offer Preferred Stock data and tools?

Certainly there are other services that provide Preferred Stock data. However the main difference with Preferred-Stock.com is that our exclusive focus is on the Preferred Stock market. We also offer the widest range of tools to locate and maintain your portfolio of Preferred Stock selections.

What is Callable Preferred Stock?

A type of Preferred Stock that carries the provision that the issuer has the right to call in the stock at a certain price and retire it. Also known as a “redeemable preferred stock.”

What is Convertible Preferred Stock?

A Preferred Stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as convertible preferred shares.

What is Cumulative Preferred Stock

A type of Preferred Stock with a provision that stipulates that is any dividends have been omitted in the past, they must be paid out to preferred shareholders first, before common shareholders can receive dividends.

What is Participating Preferred Stock?

A type of Preferred Stock that gives the holder the right to receive dividends equal to the normally specified rate that preferred dividends receive as well as an additional dividend based on some predetermined condition. The additional dividend paid to preferred shareholders is commonly structured to be paid if the amount of dividends that common shareholders receive exceeds a specified per-share amount.

Is Preferred Stock an Equity or a fixed income security?

Preferred stock is an equity. Preferred Stock also (usually) has a fixed dividend payout. This is why some investors have referred to preferred stock as “a stock that acts like a bond.” Preferreds are carried on the corporate balance sheet in the “Shareholders Equity” column, not the debt column.

Preferred stock has a fixed dividend rate which makes it a “fixed-income security.” There are a couple of exceptions, however. For example, participating preferred stock may receive greater income under certain circumstances. Also, if the corporation is experiencing cash flow difficulties, the board of directors may withhold preferred dividends. So, though preferred stock typically has a fixed dividend, it isn’t guaranteed.

What is the difference between Preferred stock and Common stock?

Preferred and Common stocks are different in two key aspects. First, let’s look at the differences and similarities between common stocks and preferred stocks. Both represent a piece of ownership in a company, and both are tools investors can use to try to profit from the future successes of the business. The main difference between the two types of stock is that holders of common stocks typically have voting privileges, whereas holders of preferred stock do not. However, preferred stockholders receive a fixed dividend from the company, while common shareholders may or may nor receive a fixed dividend from the company, depending on the decisions of the board of directors.

In the newspaper, preferred shares are usually distinguished by a .PR or a .PF following their ticker symbol.

How do investors value a Common stock vs a Preferred stock?

When valuing common and preferred stocks, an investor must consider the different properties of each type. Common stock may not offer the possibility of dividends, but generally investors will hold this type of stock because they are expecting to capture profit through a capital gain, or an increase in the stock price. Preferred stockholders, on the other hand, are generally interested in receiving a constant cash flow in the form of a dividend. In this sense, preferred stock acts similarly to a fixed-income security, such as a bond, which distributes a regular coupon payment.

How do Preferred stocks trade vs Common stocks?

Preferred stocks trade the same way as common stocks, usually through a brokerage firm and with the same transaction costs. Because the properties generally associated with these stocks will affect the way investors value them, the prices of common and preferred stocks offered by the same company will differ. Preferred stocks tend to be more stable because of the regular income stream, while common stock can be relatively more volatile.
Common and preferred stocks offer different things to different people. Receiving steady income is attractive to some investors, whereas if there is a possibility for company growth, great capital gains may appeal to others.

Preferred shares are an entirely different type of security, affording their owners priority dividend payments and a higher position on the priority ladder in the event of a company's liquidation or bankruptcy. Common stock represents the lower-ranked (and much more prevalent) form of equity financing. However, a company can choose to issue different classes of common stock to certain investors, board members or company founders.

How much does a membership to Preferred-Stock.com cost?

We offer 2 easy ways to join, either a monthly membership rate of $19.99 or an annual membership rate of $199.90. If you invest in Preferred Stocks and want a market edge, a membership to Preferred-Stock.com is essential.

Can I republish any of your Preferred Stock data in my book, magazine or newsletter or on my website?

Yes. We place only the following restrictions:

  1. Our copyright notice is visible and unmodified
  2. The phrase “Preferred Stock data courtesy of Preferred-Stock.com” must be placed somewhere the data reproduction
  3. If the Preferred Stock data is on a website, the “Preferred-Stock.com” portion of this notice must be linked to our website at www.Preferred-Stock.com

Can I access my membership from a different computer?

Yes. With your User ID and Password, you can access your Preferred-Stock.com membership from any computer in the world with internet access.

How do I sign in and sign out of Preferred-Stock.com?

In the upper right hand corner of the page, there is a blue icon that says “Sign In”. Click the blue icon, then enter your User ID and Password and click continue. When you are done, simply click the blue icon in the upper right hand corner that says “Sign Out” to end your session and protect your information.

How do I change my User ID and or Password?

When you are signed in, please visit the “My Account” section under the “Resources” tab to make any changes.

Can I become a member of Preferred-Stock.com if I don’t live in the United States?

Yes. Preferred-Stock.com is available all over the world.

Who can I contact with any additional questions?

Please email us at info@dividendinvestor.com

 
 
 
 
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