Preferred Shares and Common Shares
Before any Canadian investor puts their hard-earned money into any particular investment, they should be aware of the loads and risks involved in their share class. The uninformed investor will pick their investment without considering the share class they have bought into. This could result in unanticipated investment loss or poor dividend performance. In order to make an informed, financially wise decision in securing your investment you should have a basic understanding of the share classes and their differences.
This share grouping refers to shares that are guaranteed somewhat like bonds, to pay when there are dividends to be had. The share is also secured in the event that the company goes bankrupt. The preferred shares holder is guaranteed first dibs at company assets before the common shareholder. With this safety however, comes a price. The interest on preferred shares is lower than …Continue Reading