Definition

Noun (plural, treated as singular or plural in concept): * A class of stock in a corporation: These shares provide their owners (shareholders) with a preferential claim on the company's dividends and assets over common shareholders, but typically do not grant voting rights in corporate matters.

Usage

"Preferred shares" function as a compound noun. The term is used to discuss investment types, corporate finance, and shareholder equity. * The company issued preferred shares to raise capital without diluting the voting power of existing owners. * Income investors often buy preferred shares for their steady dividend payments.

Advanced Usage

• "Cumulative preferred shares": A type where any missed dividend payments must be paid to preferred shareholders before common shareholders can receive dividends.
  • The trust holds cumulative preferred shares, ensuring any paused dividends are eventually paid.
• "Callable preferred shares": Shares that the issuing company has the right to repurchase at a predetermined price after a set date.
  • The corporation decided to redeem its callable preferred shares to reduce its cost of capital.

Variants and Related Words

• Preferred stock: A synonymous term, often used interchangeably with "preferred shares."
• Preference shares: A common synonym, especially in British English.
• Common shares / Common stock: The contrasting class of stock, which usually carries voting rights but has a subordinate claim to dividends and assets.

Synonyms

• Preference shares
• Preferred stock

Antonyms

• Common shares
• Common stock
• Ordinary shares

Related Idioms/Phrases

• "To have priority over": This phrase describes the key characteristic of preferred shares regarding dividends and assets.
  • Holders of preferred shares have priority over common shareholders in the event of liquidation.

Noun

1. stock whose holders are guaranteed priority in the payment of dividends but whose holders have no voting rights