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What is the difference between common, preferred, and unlisted stocks?

May 11, 2012 by Jade from Gulfport, MS in  |  Flag
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Hi Jade; To build on Marty's answer, while preferred shareholders have no real control of the company they own shares in, it's also worth knowing that preferred stock carries a promised annual dividend. Virtually all preferred stock is cumulative, meaning that any missed dividends must be made good before common shareholders can receive their dividends. In addition, if the company goes through reorganization, the preferred shareholders must be paid the liquidation value of their stock before common shareholders receive anything... so the dividends are almost as dependable as the same company's bond interest, which does have priority. These days, preferreds are getting a second look by many investors since bond yields are so low. Before investing, be sure to do your homework and maybe talk to an advisor who has experience in this area. I'm sure you can find one local to you.

Comment   |  Flag   |  May 11, 2012 from Moorpark, CA

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Think of a common stockholder as an owner of the company and a preferred stockholder as a creditor to the company. Preferred stockholders are somewhat like bondholders except they have way fewer rights if the company gets into trouble.

Unlisted stocks are simply stocks that don't trade on a stock exchange.

1 Comment   |  Flag   |  May 11, 2012 from Bryn Mawr, PA
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