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Preferred share

A preferred share is a kind of share that usually pays a fixed dividend before common shareholders receive anything, and ranks ahead of them if the company is wound up, but normally carries no vote.

Preferred shares sit between a bond and a common stock: they pay a steady income like a bond, but they are still shares, so the company can skip the dividend in hard times. Their price usually moves less than the company’s common shares.

Learn more: which markets exist.