Common stock is the riskiest corporate security,followed by preferred stock and then bonds.

Question

Quizplus · Accepted Answer

Common stock represents ownership in a company and its value is tied to the success or failure of the company, making it the riskiest corporate security. Preferred stock is less risky because it typically pays a fixed dividend and has priority over common stock in the event of liquidation. Bonds are the least risky, as they represent a loan to the company and have a fixed interest rate and maturity date.

Common Stock Is the Riskiest Corporate Security,followed by Preferred Stock