Question

What are preferred stocks?

Answer 1

The term "stock" refers to ownership or equity in a firm. There are two types of equity—common stock and preferred stock. Preferred stockholders have a higher claim to dividends or asset distribution than common stockholders.1 The details of each preferred stock depend on the issue.

Answer 2

See below

Step-by-step explanation:

Preferred stocks are a special group of shares issued by a company to raise capital. They combine features of ownership and debts, which make them hybrid securities. Like bonds, preferred shares are issued at par value.

Preferred stocks pay fixed dividends following a set schedule. Holders of preferred shares do enjoy voting rights. However, they get preference in dividends sharing. They also enjoy priority claims to the company assets in case of a dissolution.