Which type of preferred stock trades close to its par value?
A) Straight preferred stock
B) Participating preferred stock
C) Adjustable rate preferred stock (ARPS)
D) Mandatory redeemable preferred stock
E) Preferred stock with a cumulative provision

Question

Quizplus · Accepted Answer

Adjustable rate preferred stock (ARPS) trades close to its par value because its dividends are adjusted periodically based on interest rate changes, reducing price volatility.

Which Type of Preferred Stock Trades Close to Its Par