Which of the following securities is a popular hybrid security?
A) preferred stock
B) common stock
C) options
D) futures

Question

Quizplus · Accepted Answer

Preferred stock is a hybrid security because it has characteristics of both stocks and bonds. Like a stock, it represents ownership in a company and pays a regular dividend, but like a bond, it has a fixed dividend rate and can be redeemed for a predetermined price. Common stock, options, and futures are not hybrid securities as they have different characteristics and features.

Which of the Following Securities Is a Popular Hybrid Security