Preferred stock does not represent an ownership claim.

Name: Preferred stock does not represent an ownership claim.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Preferred stock represents a form of equity ownership, but it does not usually carry voting rights and it may have a fixed dividend payout, rather than a share of profits. Additionally, in the event of bankruptcy, preferred stockholders may receive priority over common stockholders but they still do not have the same rights as bondholders or creditors.

Preferred Stock Does Not Represent an Ownership Claim