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![]() | The contents of the Supervoting stock page were merged into Preferred stock on 10 August 2015. For the contribution history and old versions of the redirected page, please see its history; for the discussion at that location, see its talk page. |
why companies prefer the prefered stock holders over the common stock holders to pay the dividend and other benifits? How so (i.e in the US and in Canada)?
should preferred stock less or more ?
Under what conditions can preferred stock holders vote? —Preceding unsigned comment added by 207.235.20.226 ( talk) 22:52, 23 April 2009 (UTC)
does only private companies issue prefered stock? —Preceding unsigned comment added by 202.83.170.98 ( talk) 09:25, 11 December 2007 (UTC)
"...government regulations and the rules of stock exchanges discourage the issuance of publicly traded preferred shares"
As far as Canada goes, this is simply wrong. There is a very healthy population of preferred shares trading on the Toronto Stock Exchange ... I suspect that this statement, if it has any truth at all, applies only to the US, a market with which I am not familiar. JiHymas@himivest.com 21:08, 3 July 2006 (UTC)
The statement that preferred shares are only in financials, REITS, etc. is wrong. I presently hold HOVNP, the preferred stock of a homebuilder (not a REIT). I worked at a small high tech company that, in a time of distress, issued preferred "D" series shares at a million dollars or so par value, to gain funding to stay alive. These "D" shares were given extraorinary voting and liqidation rights (basically, they sold out the common holders to the "D" holders in exchange for capital infusion). When that wasn't enough, the "D" holder voted us into liquidation and took the Intellectual Property of the company during liquidation. (Microsoft was the holder of this "D" series. They got a great patent library as part of this deal...). So U.S. preferreds have many issuers and many uses, some defensive in takeovers, some offensive. Chiefio 16:26, 21 March 2008 (UTC) —Preceding unsigned comment added by 4.246.21.190 ( talk) 15:23, 21 March 2008 (UTC)
The explanation regarding US Issuers is informative, but is similar to the situation in Canada. The Canadian market has developed because of the dividend tax-credit and gross-up, which effectively taxes dividends at a lower rate than interest when received by the security holder. Thus, although pre-tax returns are generally lower with preferreds, after-tax returns have historically been greater. How does this relate to the US situation? JiHymas@himivest.com 00:30, 9 August 2006 (UTC)
"Preferred stock has a par value or liquidation value associated with it. This represents the amount of capital that was contributed to the corporation when the shares were first issued."
What is this? Par value is an amount set by the articles of organization or bylaws (need research as to which one) as to the value of the preferred stock. The proceeds actually contributed to the corporation is almost always higher than the par value, especially since we're talking about preferred stock here (and not common stock). The proceeds actually collected for the issuance of the stock is actually: Par value + Additional-paid-in-capital. APIC has not even been discussed in the article. -- RoshSok 18:11, 18 February 2007 (UTC)
Can you give an example of an issue in which the issuance price was greater than the Par Value? Such an issue would be, at best, extremely rare in Canada. The terms would also have to be carefully described in the prospectus to avoid running afoul of the deemed dividend taxation rules on redemption. jiHymas@himivest.com 69.158.153.2 04:48, 22 February 2007 (UTC)
I'm an attorney that deals with the issuance of preferred stock by privately held (venture backed start-ups) on a weekly basis, and par value is always a fraction of a cent, whereas the issue price is typically no less than several dollars. The section is not only overly broad, its completely incorrect. I can produce preferred stock certificates from literally dozens of companies that show this to be true. As to the dividends point, this to is flat out wrong. Dividends are calculated based on the issuance price, not the par value. This can be seen in any number of Certificates of Incorporation, which are public documents and can be obtained from the DE Secretary of State. Also, NVCA.org, the National Venture Capital Association, provides Industry standard sample documents (
http://www.nvca.org/index.php?option=com_content&view=article&id=108&Itemid=136). The sample Certificate of Incorporation clearly shows that Dividends on preferred shares are calculated based on ISSUANCE PRICE (see footnote 4 on the second page for discussion on par value, see page 4 for section on dividends) — Preceding
unsigned comment added by
208.255.90.221 (
talk)
20:17, 31 October 2011 (UTC)
As I understand it, a bank may issue prefs to count towards its regulatory capital. Are there any requirements regarding what it may do with these funds? Can it only be held in cash (call accoutns for example)? Zain Ebrahim 08:52, 5 June 2007 (UTC)
I am fascinated to learn that an editor considers the article at about.com ( http://beginnersinvest.about.com/cs/newinvestors/a/091602a.htm) superior ( http://en.wikipedia.org/?title=Preferred_stock&diff=170963262&oldid=170962876) to my explanation (published by third-party print media) of the difference between perpetuals and retractibles ( http://www.himivest.com/media/moneysaver_0606.pdf). Any explanations and suggestions for future improvements will be greatly appreciated. jiHymas@himivest.com 216.191.217.82 ( talk) 17:07, 23 November 2007 (UTC)
it is known that in world a company prefered to give dividend to the prefered stock holder instead of common stock holder. why companies prefer them on common stock holders? —Preceding unsigned comment added by 202.83.170.98 ( talk) 09:30, 11 December 2007 (UTC)
It appears that a user deleted a broken link; the broken link has now been republished by svetoid. The broken link is http://www.ida.ca/Files/Media/MediaRelease/General/MRG2006020601_en.pdf and the working link is http://www.ida.ca/IDAWebsite/Files/Media/MediaRelease/General/MRG2006020601_en.pdf jiHymas@himivest.com 216.191.217.82 ( talk) 21:37, 15 February 2008 (UTC)
On the other hand, the Tel Aviv Stock Exchange prohibits listed companies from having more than one class of capital stock.[citation needed]
Nonsense. According to the TASE: A listed company that has one type of shares may issue or allocate shares only of the type listed for trading. A listed company whose capital includes different types of shares can allocate shares of the preferred type, in terms of voting rights. See http://www.tase.co.il/TASEEng/Listings/FollowOnOfferings/
The Industrial Development Bank of Israel Limited has four classes of capital stock listed. See http://www.tase.co.il/TASEEng/General/Company/companyDetails.htm?subDataType=0&companyID=000606&shareID=00606095 One of these classes has voting privileges - the other voting class issued by the company does not trade on the exchange. jiHymas@himivest.com 67.71.178.87 ( talk) 00:45, 22 March 2008 (UTC)
Further: See the IDBI's form 20-F (at http://www.sec.gov/Archives/edgar/data/50277/000117891306001301/zk62585.htm ) filed with the SEC 2006-7-17: THE TRADING ON THE TEL AVIV STOCK EXCHANGE IN OUR ORDINARY PREFERRED SHARES AND CERTAIN CLASSES OF OUR PREFERRED SHARES MAY BE RESTRICTED AND THESE SHARES MAY EVENTUALLY BE DELISTED.
Our preferred ordinary shares, our C, CC, and CC1 shares and our capital notes are traded on the Tel Aviv Stock Exchange (TASE).
jiHymas@himivest.com 67.71.178.87 ( talk) 01:03, 22 March 2008 (UTC)
Terms of the preferred stock are stated in a "Certificate of Designation".
Huh? Never heard of it. I suspect this terminology is unique to the US. In Canada, terms of public preferred stock will be stated in a prospectus. One example of a "Certificate of Designation" may be found at http://www.sec.gov/Archives/edgar/data/1102542/000110465903023055/a03-4160_1ex3d1.htm ;
jiHymas@himivest.com 69.158.148.160 ( talk) 05:44, 28 March 2008 (UTC)
Are they governement versions of 'preference shares' or something different altogether? They are safest of all stocks and much safer than stockmarket, i know that much, but can they be compared with preference shares? Moneyprobs ( talk) 09:59, 1 August 2008 (UTC)
hi —Preceding unsigned comment added by 66.211.69.246 ( talk) 01:03, 22 November 2008 (UTC)
Should we be referencing a Google search query? That doesn't seem a proper source that can be cited Evaders99 ( talk) 02:31, 17 July 2009 (UTC)
Does anyone think that this page should be rewritten and reorganized? All the information is bunched together in the rights and users section. For starters, I think the rights section should be changed to something like "Characteristics".
The large list of countries and some random tidbit of preferred stock info seems out of place. The size of the section should at least be shrunk down to a table or a bullet-list.-- Glinos ( talk) 09:02, 10 December 2009 (UTC)
Errors have crept into the formulae about the cost of Preference Share Capital.
1) The two formulae given for the Cost of Preference Share Capital without flotation are identical, save for the fact that the second formula has an error in it -- it is missing a closing bracket in the numerator. Here is how the formulae are at present (07/Feb/2010):
Here is how the formulae must be (just one formula, not two identical formulae):
2) There is a minor error in the formula given for the Cost of Preference Share Capital with flotation -- it is missing a closing round bracket in the numerator. Here is how the formula is at present (07/Feb/2010):
Here is how the formula must be:
If no one would object to the above I could amend the text to correct these errors, otherwise I will leave it to the more knowledgeable to correct the errors.
Plamen Grozdanov (
talk)
11:48, 7 February 2010 (UTC)
I am new to preference shares, but it seems this article is missing good explanations or definitions of the terms I see used, for example:
The terms "callable" and "redeemable" need to be explained, and maybe any UK US differences highlighted. - 84user ( talk) 20:28, 28 April 2011 (UTC)
Hmmm, the Australians define redeemable more flexibly here, pages 2 and 3: "Redeemable preference shares under the Corporations Act (section 254A(3)) are shares which are issued on terms where they are liable to be redeemed at: 1. a fixed time ... of a particular event; or 2. at the company's option or at the shareholder's option." It is possible the Malaysian share uses redeem to mean at the shareholder's option. From the little I have seen of UK preference shares so far, the meaning is at the company's option. - 84user ( talk) 15:18, 12 May 2011 (UTC)
Almost all US venture capital investments are made in the form of preferred stock. The shares always have voting rights, typically have special protections and the emphasis on dividends is much lower. Dividends are rarely paid and frequently don't even accumulate if unpaid. With 3000+ VC financings a year, this seems like an area of preferred stock that should be covered here. I'm tempted to take on a substantial edit here, but I'm a real newbie to Wikipedia. Any advice? — Preceding unsigned comment added by Runjohnnyrun ( talk • contribs) 03:28, 9 January 2012 (UTC)
"any combination of features not possessed by common stock including properties of both an equity and a debt instrument, and is generally considered a hybrid instrument": this description is completely useless to someone, like me, who doesn't already know all about stocks. Can the introduction be rewritten to be comprehensible to laymen? MirkMeister ( talk) 09:52, 23 July 2014 (UTC)
Is it just me or is the mobile view of this article screwed up? This is the first Wikipedia article that I've encountered that didn't have sections hidden from view and accessible from drop-down arrows. 2600:1:D413:C317:42F6:3080:F8EC:8CBE ( talk) 08:46, 12 May 2017 (UTC)
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If only financial institutions can buy preferred stock - could you list what a financial institution is defined as ( ie banks, ??? What is the yield difference between preferred and common under different scenarios - good times bad times, recession, depression, bankruptcy, etc Thanks 2601:181:8301:4510:1450:8C41:5914:AE0D ( talk) 05:18, 6 February 2018 (UTC) 0.
Describe 5 types of preference shares.. 41.113.33.164 ( talk) 10:29, 29 May 2022 (UTC)
![]() | This ![]() It is of interest to the following WikiProjects: | |||||||||||||||||||||||
|
![]() | The contents of the Supervoting stock page were merged into Preferred stock on 10 August 2015. For the contribution history and old versions of the redirected page, please see its history; for the discussion at that location, see its talk page. |
why companies prefer the prefered stock holders over the common stock holders to pay the dividend and other benifits? How so (i.e in the US and in Canada)?
should preferred stock less or more ?
Under what conditions can preferred stock holders vote? —Preceding unsigned comment added by 207.235.20.226 ( talk) 22:52, 23 April 2009 (UTC)
does only private companies issue prefered stock? —Preceding unsigned comment added by 202.83.170.98 ( talk) 09:25, 11 December 2007 (UTC)
"...government regulations and the rules of stock exchanges discourage the issuance of publicly traded preferred shares"
As far as Canada goes, this is simply wrong. There is a very healthy population of preferred shares trading on the Toronto Stock Exchange ... I suspect that this statement, if it has any truth at all, applies only to the US, a market with which I am not familiar. JiHymas@himivest.com 21:08, 3 July 2006 (UTC)
The statement that preferred shares are only in financials, REITS, etc. is wrong. I presently hold HOVNP, the preferred stock of a homebuilder (not a REIT). I worked at a small high tech company that, in a time of distress, issued preferred "D" series shares at a million dollars or so par value, to gain funding to stay alive. These "D" shares were given extraorinary voting and liqidation rights (basically, they sold out the common holders to the "D" holders in exchange for capital infusion). When that wasn't enough, the "D" holder voted us into liquidation and took the Intellectual Property of the company during liquidation. (Microsoft was the holder of this "D" series. They got a great patent library as part of this deal...). So U.S. preferreds have many issuers and many uses, some defensive in takeovers, some offensive. Chiefio 16:26, 21 March 2008 (UTC) —Preceding unsigned comment added by 4.246.21.190 ( talk) 15:23, 21 March 2008 (UTC)
The explanation regarding US Issuers is informative, but is similar to the situation in Canada. The Canadian market has developed because of the dividend tax-credit and gross-up, which effectively taxes dividends at a lower rate than interest when received by the security holder. Thus, although pre-tax returns are generally lower with preferreds, after-tax returns have historically been greater. How does this relate to the US situation? JiHymas@himivest.com 00:30, 9 August 2006 (UTC)
"Preferred stock has a par value or liquidation value associated with it. This represents the amount of capital that was contributed to the corporation when the shares were first issued."
What is this? Par value is an amount set by the articles of organization or bylaws (need research as to which one) as to the value of the preferred stock. The proceeds actually contributed to the corporation is almost always higher than the par value, especially since we're talking about preferred stock here (and not common stock). The proceeds actually collected for the issuance of the stock is actually: Par value + Additional-paid-in-capital. APIC has not even been discussed in the article. -- RoshSok 18:11, 18 February 2007 (UTC)
Can you give an example of an issue in which the issuance price was greater than the Par Value? Such an issue would be, at best, extremely rare in Canada. The terms would also have to be carefully described in the prospectus to avoid running afoul of the deemed dividend taxation rules on redemption. jiHymas@himivest.com 69.158.153.2 04:48, 22 February 2007 (UTC)
I'm an attorney that deals with the issuance of preferred stock by privately held (venture backed start-ups) on a weekly basis, and par value is always a fraction of a cent, whereas the issue price is typically no less than several dollars. The section is not only overly broad, its completely incorrect. I can produce preferred stock certificates from literally dozens of companies that show this to be true. As to the dividends point, this to is flat out wrong. Dividends are calculated based on the issuance price, not the par value. This can be seen in any number of Certificates of Incorporation, which are public documents and can be obtained from the DE Secretary of State. Also, NVCA.org, the National Venture Capital Association, provides Industry standard sample documents (
http://www.nvca.org/index.php?option=com_content&view=article&id=108&Itemid=136). The sample Certificate of Incorporation clearly shows that Dividends on preferred shares are calculated based on ISSUANCE PRICE (see footnote 4 on the second page for discussion on par value, see page 4 for section on dividends) — Preceding
unsigned comment added by
208.255.90.221 (
talk)
20:17, 31 October 2011 (UTC)
As I understand it, a bank may issue prefs to count towards its regulatory capital. Are there any requirements regarding what it may do with these funds? Can it only be held in cash (call accoutns for example)? Zain Ebrahim 08:52, 5 June 2007 (UTC)
I am fascinated to learn that an editor considers the article at about.com ( http://beginnersinvest.about.com/cs/newinvestors/a/091602a.htm) superior ( http://en.wikipedia.org/?title=Preferred_stock&diff=170963262&oldid=170962876) to my explanation (published by third-party print media) of the difference between perpetuals and retractibles ( http://www.himivest.com/media/moneysaver_0606.pdf). Any explanations and suggestions for future improvements will be greatly appreciated. jiHymas@himivest.com 216.191.217.82 ( talk) 17:07, 23 November 2007 (UTC)
it is known that in world a company prefered to give dividend to the prefered stock holder instead of common stock holder. why companies prefer them on common stock holders? —Preceding unsigned comment added by 202.83.170.98 ( talk) 09:30, 11 December 2007 (UTC)
It appears that a user deleted a broken link; the broken link has now been republished by svetoid. The broken link is http://www.ida.ca/Files/Media/MediaRelease/General/MRG2006020601_en.pdf and the working link is http://www.ida.ca/IDAWebsite/Files/Media/MediaRelease/General/MRG2006020601_en.pdf jiHymas@himivest.com 216.191.217.82 ( talk) 21:37, 15 February 2008 (UTC)
On the other hand, the Tel Aviv Stock Exchange prohibits listed companies from having more than one class of capital stock.[citation needed]
Nonsense. According to the TASE: A listed company that has one type of shares may issue or allocate shares only of the type listed for trading. A listed company whose capital includes different types of shares can allocate shares of the preferred type, in terms of voting rights. See http://www.tase.co.il/TASEEng/Listings/FollowOnOfferings/
The Industrial Development Bank of Israel Limited has four classes of capital stock listed. See http://www.tase.co.il/TASEEng/General/Company/companyDetails.htm?subDataType=0&companyID=000606&shareID=00606095 One of these classes has voting privileges - the other voting class issued by the company does not trade on the exchange. jiHymas@himivest.com 67.71.178.87 ( talk) 00:45, 22 March 2008 (UTC)
Further: See the IDBI's form 20-F (at http://www.sec.gov/Archives/edgar/data/50277/000117891306001301/zk62585.htm ) filed with the SEC 2006-7-17: THE TRADING ON THE TEL AVIV STOCK EXCHANGE IN OUR ORDINARY PREFERRED SHARES AND CERTAIN CLASSES OF OUR PREFERRED SHARES MAY BE RESTRICTED AND THESE SHARES MAY EVENTUALLY BE DELISTED.
Our preferred ordinary shares, our C, CC, and CC1 shares and our capital notes are traded on the Tel Aviv Stock Exchange (TASE).
jiHymas@himivest.com 67.71.178.87 ( talk) 01:03, 22 March 2008 (UTC)
Terms of the preferred stock are stated in a "Certificate of Designation".
Huh? Never heard of it. I suspect this terminology is unique to the US. In Canada, terms of public preferred stock will be stated in a prospectus. One example of a "Certificate of Designation" may be found at http://www.sec.gov/Archives/edgar/data/1102542/000110465903023055/a03-4160_1ex3d1.htm ;
jiHymas@himivest.com 69.158.148.160 ( talk) 05:44, 28 March 2008 (UTC)
Are they governement versions of 'preference shares' or something different altogether? They are safest of all stocks and much safer than stockmarket, i know that much, but can they be compared with preference shares? Moneyprobs ( talk) 09:59, 1 August 2008 (UTC)
hi —Preceding unsigned comment added by 66.211.69.246 ( talk) 01:03, 22 November 2008 (UTC)
Should we be referencing a Google search query? That doesn't seem a proper source that can be cited Evaders99 ( talk) 02:31, 17 July 2009 (UTC)
Does anyone think that this page should be rewritten and reorganized? All the information is bunched together in the rights and users section. For starters, I think the rights section should be changed to something like "Characteristics".
The large list of countries and some random tidbit of preferred stock info seems out of place. The size of the section should at least be shrunk down to a table or a bullet-list.-- Glinos ( talk) 09:02, 10 December 2009 (UTC)
Errors have crept into the formulae about the cost of Preference Share Capital.
1) The two formulae given for the Cost of Preference Share Capital without flotation are identical, save for the fact that the second formula has an error in it -- it is missing a closing bracket in the numerator. Here is how the formulae are at present (07/Feb/2010):
Here is how the formulae must be (just one formula, not two identical formulae):
2) There is a minor error in the formula given for the Cost of Preference Share Capital with flotation -- it is missing a closing round bracket in the numerator. Here is how the formula is at present (07/Feb/2010):
Here is how the formula must be:
If no one would object to the above I could amend the text to correct these errors, otherwise I will leave it to the more knowledgeable to correct the errors.
Plamen Grozdanov (
talk)
11:48, 7 February 2010 (UTC)
I am new to preference shares, but it seems this article is missing good explanations or definitions of the terms I see used, for example:
The terms "callable" and "redeemable" need to be explained, and maybe any UK US differences highlighted. - 84user ( talk) 20:28, 28 April 2011 (UTC)
Hmmm, the Australians define redeemable more flexibly here, pages 2 and 3: "Redeemable preference shares under the Corporations Act (section 254A(3)) are shares which are issued on terms where they are liable to be redeemed at: 1. a fixed time ... of a particular event; or 2. at the company's option or at the shareholder's option." It is possible the Malaysian share uses redeem to mean at the shareholder's option. From the little I have seen of UK preference shares so far, the meaning is at the company's option. - 84user ( talk) 15:18, 12 May 2011 (UTC)
Almost all US venture capital investments are made in the form of preferred stock. The shares always have voting rights, typically have special protections and the emphasis on dividends is much lower. Dividends are rarely paid and frequently don't even accumulate if unpaid. With 3000+ VC financings a year, this seems like an area of preferred stock that should be covered here. I'm tempted to take on a substantial edit here, but I'm a real newbie to Wikipedia. Any advice? — Preceding unsigned comment added by Runjohnnyrun ( talk • contribs) 03:28, 9 January 2012 (UTC)
"any combination of features not possessed by common stock including properties of both an equity and a debt instrument, and is generally considered a hybrid instrument": this description is completely useless to someone, like me, who doesn't already know all about stocks. Can the introduction be rewritten to be comprehensible to laymen? MirkMeister ( talk) 09:52, 23 July 2014 (UTC)
Is it just me or is the mobile view of this article screwed up? This is the first Wikipedia article that I've encountered that didn't have sections hidden from view and accessible from drop-down arrows. 2600:1:D413:C317:42F6:3080:F8EC:8CBE ( talk) 08:46, 12 May 2017 (UTC)
Hello fellow Wikipedians,
I have just modified one external link on Preferred stock. Please take a moment to review my edit. If you have any questions, or need the bot to ignore the links, or the page altogether, please visit this simple FaQ for additional information. I made the following changes:
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If only financial institutions can buy preferred stock - could you list what a financial institution is defined as ( ie banks, ??? What is the yield difference between preferred and common under different scenarios - good times bad times, recession, depression, bankruptcy, etc Thanks 2601:181:8301:4510:1450:8C41:5914:AE0D ( talk) 05:18, 6 February 2018 (UTC) 0.
Describe 5 types of preference shares.. 41.113.33.164 ( talk) 10:29, 29 May 2022 (UTC)