Floating-rate preferred stock offers competitive rates of return with traditional money market instruments but:

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Floating-rate preferred stock still provides the corporate investor with the tax exclusion on dividend income, making it a competitive option compared to traditional money market instruments. However, it may still be rated by Moody's or Standard & Poor's and does not have a fixed rate of dividend income. The trading market for floating-rate preferred stock may also vary depending on the specific stock.

Floating-Rate Preferred Stock Offers Competitive Rates of Return with Traditional