Why would an investor buy preferred stock?
Investors buy preferred stock because they receive dividend payments and will likely receive their principal back when they sell their position. Preferred stock normally gives the investor a chance to have a steady income over an extended period of time. Since dividends are paid on preferred stock before common stock, investors view preferred stock dividends as a more steady source of income than common stock dividends.Do preferred stockholders have any voting rights? There are essentially no voting rights that come along with the purchase of preferred stock. After a certain number of quarters with no dividends received, preferred stockholders may be compensated with shares of common stock. Keep in mind, this is an indefinite feature and does not have a time limitation. The company has the right to buy out preferred stockholders at a given price, or at any given date in the future, for a formula price set at the time an investor purchased the stock.What does The Henssler Financial Grou
