What is the primary difference between "Preferred stock and Common stock"?

Answer 1

preferred- you get dividends before common stockholders, but you can't vote for board members of the company
common- you get dividends last, but you can vote

Answer 2

Preffered stock which provides a specific dividend that is paid before any dividends are paid to common stock holders, and which takes precedence over common stock in the event of a liquidation. Like common stock, preferred stocks represent partial ownership in a company, although preferred stock shareholders do not enjoy any of the voting rights of common stockholders. Also unlike common stock, a preferred stock pays a fixed dividend that does not fluctuate, although the company does not have to pay this dividend if it lacks the financial ability to do so. The main benefit to owning preferred stock is that the investor has a greater claim on the company’s assets than common stockholders. Preferred shareholders always receive their dividends first and, in the event the company goes bankrupt, preferred shareholders are paid off before common stockholders.

Answer 3

When the company goes bankrupt preferred stockholders get paid before the common stockholders. Preferred stock normally pays a better dividend, and generally expires at somepoint. IE the company buys it back or you convert it to common shares. YAHOO finance has a great glossary of terms if you are looking for a more "by the book" answer.

Answer 4

Pref's are higher seniority on the capital structure than common stock but act like hybrid bond/common equity instruments. Since they are issued with a face value that attempts to achieve a certain yield, they are sensitive to interest rates (like bonds) and their price tends to be more stable and will fluctuate more in response to interest rate changes than company fundamentals (in normal markets). As a rule, their pricing tends to be much more stable but they are much less liquid than common stock. They do not generally allow for voting rights unless an event (such as non-payment of the dividends) triggers voting privileges. Cumulative prefs simply have a covenant stating that if the company cannot pay the dividends on the issue, the dividend payments accrue and must be paid out in full before any dividends are paid to common stock holders. The advantages/disadvantages are purely relative - Prefs are great if you're looking for income/yield and greater price stability. If you are looking for capital gains, common shares are the appropriate instrument.

Answer 5

If a company goes baknrupt, the preferred stockholders get paid first.

Answer 6

preffered means you prefer and scommon stock means you commonly stocked it somewhere without others knowing it where you kept it. secret

Answer 7

the way dividends are paid.