• HOME
  • ABOUT US
    • About Us
    • Meet Our Team
    • Our Promise
    • Brokerage Services
  • MISSION STATEMENT
  • OUR SERVICES
    • Individuals and Families
    • Business Owners
    • Retirees/Medicare Eligible
  • PLANNING
    • Life Insurance
    • College Planning
    • Retirement Planning
    • Build Wealth
    • Disability Income
    • Mortgage Protection
    • Small Business Valuation
    • Long Term Care
    • Final Expense
  • GROUP PLANS
  • BUSINESS
    • Business
    • Key Employees
    • Employee Benefits
    • Financial Management
    • Protect Your Business
    • Retirement Planning
    • Succession Planning
  • CAREERS
    • Careers
    • Careers Sampling
    • Careers Training
    • Internships
    • Producers
    • Join Our Team
  • RESOURCES
    • Articles
    • Market Watch
    • Newsletter
    • FAQs
  • OUR PARTNERS
  • CONTACT US
    • Contact Us
    • Request a Quote
Sunshine Financial Solutions | Insurance, Retirement, College Funding and Business Solutions
  • HOME
  • ABOUT US
    • About Us
    • Meet Our Team
    • Our Promise
    • Brokerage Services
  • MISSION STATEMENT
  • OUR SERVICES
    • Individuals and Families
    • Business Owners
    • Retirees/Medicare Eligible
  • PLANNING
    • Life Insurance
    • College Planning
    • Retirement Planning
    • Build Wealth
    • Disability Income
    • Mortgage Protection
    • Small Business Valuation
    • Long Term Care
    • Final Expense
  • GROUP PLANS
  • BUSINESS
    • Business
    • Key Employees
    • Employee Benefits
    • Financial Management
    • Protect Your Business
    • Retirement Planning
    • Succession Planning
  • CAREERS
    • Careers
    • Careers Sampling
    • Careers Training
    • Internships
    • Producers
    • Join Our Team
  • RESOURCES
    • Articles
    • Market Watch
    • Newsletter
    • FAQs
  • OUR PARTNERS
  • CONTACT US
    • Contact Us
    • Request a Quote

Newsletter

Common Stock vs. Preferred Stock

1/3/2019

0 Comments

 
Common Stock vs. Preferred Stock​
Common stock and preferred stock are the two main types of stocks that are sold by companies and traded among investors on the open market. Each type gives stockholders a partial ownership in the company represented by the stock.
Despite some similarities, common stock and preferred stock have some significant differences, including the risk involved with ownership. It’s important to understand the strengths and weaknesses of both types of stocks before purchasing them.
COMMON STOCKCommon stock is the most common type of stock that is issued by companies. It entitles shareholders to share in the company’s profits through dividends and/or capital appreciation. Common stockholders are usually given voting rights, with the number of votes directly related to the number of shares owned. Of course, the company’s board of directors can decide whether or not to pay dividends, as well as how much is paid.
Owners of common stock have “preemptive rights” to maintain the same proportion of ownership in the company over time. If the company circulates another offering of stock, shareholders can purchase as much stock as it takes to keep their ownership comparable.
Common stock has the potential for profits through capital gains. The return and principal value of stocks fluctuate with changes in market conditions. Shares, when sold, may be worth more or less than their original cost. Shareholders are not assured of receiving dividend payments. Investors should consider their tolerance for investment risk before investing in common stock.
PREFERRED STOCKPreferred stock is generally considered less volatile than common stock but typically has less potential for profit. Preferred stockholders generally do not have voting rights, as common stockholders do, but they have a greater claim to the company’s assets. Preferred stock may also be “callable,” which means that the company can purchase shares back from the shareholders at any time for any reason, although usually at a favorable price.
Preferred stock shareholders receive their dividends before common stockholders receive theirs, and these payments tend to be higher. Shareholders of preferred stock receive fixed, regular dividend payments for a specified period of time, unlike the variable dividend payments sometimes offered to common stockholders. Of course, it’s important to remember that fixed dividends depend on the company’s ability to pay as promised. In the event that a company declares bankruptcy, preferred stockholders are paid before common stockholders. Unlike preferred stock, though, common stock has the potential to return higher yields over time through capital growth. Remember that investments seeking to achieve higher rates of return also involve a higher degree of risk.
* * *
Both common stock and preferred stock have their advantages. When considering which type may be suitable for you, it is important to assess your financial situation, time frame, and investment goals.


The information in this newsletter is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the ­purpose of ­avoiding any ­federal tax penalties. You are encouraged to seek advice from an independent professional ­advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the ­purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2019 Broadridge Investor Communication Solutions, Inc.


0 Comments



Leave a Reply.

    Archives

    January 2019
    December 2018
    November 2018

    Categories

    All
    College Planning
    Estate Planning
    Retirement
    Risk Management

    RSS Feed

Picture

    Subscribe To Our Newsletter Today!

Submit

Contact Us

Location

2500 N. Military Trail Ste 314
Boca Raton, FL 33431

Phone: 561-609-2251
info@sfsfinancial.org
© 2021 Sunshine Financial Solutions of South Florida, Inc.
  • HOME
  • ABOUT US
    • About Us
    • Meet Our Team
    • Our Promise
    • Brokerage Services
  • MISSION STATEMENT
  • OUR SERVICES
    • Individuals and Families
    • Business Owners
    • Retirees/Medicare Eligible
  • PLANNING
    • Life Insurance
    • College Planning
    • Retirement Planning
    • Build Wealth
    • Disability Income
    • Mortgage Protection
    • Small Business Valuation
    • Long Term Care
    • Final Expense
  • GROUP PLANS
  • BUSINESS
    • Business
    • Key Employees
    • Employee Benefits
    • Financial Management
    • Protect Your Business
    • Retirement Planning
    • Succession Planning
  • CAREERS
    • Careers
    • Careers Sampling
    • Careers Training
    • Internships
    • Producers
    • Join Our Team
  • RESOURCES
    • Articles
    • Market Watch
    • Newsletter
    • FAQs
  • OUR PARTNERS
  • CONTACT US
    • Contact Us
    • Request a Quote