The difference between common and preferred stock is that the latter is a debt instrument, whereas the former represents an equity interest in the company.

Name: The difference between common and preferred stock is that the latter is a debt instrument, whereas the former represents an equity interest in the company.
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Preferred stock is not a debt instrument; it is a type of equity that typically has fixed dividends and priority over common stock in asset liquidation.

The Difference Between Common and Preferred Stock Is That the Latter