Common and preferred stocks

Common stock is the most common type of stock that is issued by companies.

Owners of common stock have “preemptive rights” to maintain the same proportion of ownership in the company over time. If the company circulates another offering of stock, shareholders can purchase as much stock as it takes to keep their ownership comparable.

Common stock has the potential for profits through capital gains. The return and principal value of stocks fluctuate with changes in market conditions. Shares, when sold, may be worth more or less than their original cost. Shareholders are not assured of receiving dividend payments. Investors should consider their tolerance for investment risk before investing in common stock.

Investing in preferred stocks

Preferred stock is generally considered less volatile than common stock but typically has less potential for profit. Preferred stockholders generally do not have voting rights, as common stockholders do, but they have a greater claim to the company’s assets. Preferred stock may also be “callable,” which means that the company can purchase shares back from the shareholders at any time for any reason, although usually at a favorable price.

Common Stock vs. Preferred Stock

Common stock and preferred stock are the two main types of stocks that are sold by companies and traded among investors on the open market. Each type gives stockholders a partial ownership in the company represented by the stock.

Despite some similarities, common stock and preferred stock have some significant differences, including the risk involved with ownership. It’s important for us at Invest-suise to explain the strengths and weaknesses of both types of stocks before purchasing them.

Conclusion

Our experienced and professional advisors will devise a unique plan that's tailored for each client's individual needs. taking into account income, portfolio diversification and ultimatley your financial goals.