Preferred Shares

Preferred Shares - Preferred Shares are shares which provides a specific dividend. It is paid before the common share holders get paid. Preferred shares take precedent over common shares in the event of a liquidation. These shares represent part of an ownership of a company. Preferred shareholders do not enjoy voting rights, like common stock holders do. Preferred shares pay a fixed dividend, although the company does not have to pay dividend when it lacks the financial ability to pay. Still, in regard to common share holders, preferred share holders get their dividend before common share holders do. Investors with preferred shares also have a bigger claim on the assets of a company.