Which of the following has the highest expected return to the investor?

Question

Quizplus · Accepted Answer

Common stock typically has the highest expected return because of its potential for capital appreciation and dividends. However, it also carries higher risk as compared to preferred stock and bonds. Preferred stock provides fixed dividends and has lower risk as compared to common stock. Bonds provide fixed income and are considered the lowest risk investment among the three options, but also have lower returns.

Which of the Following Has the Highest Expected Return to the Investor