Lecture 8 notes Oct 13 - Preferred Shares: Hybrid Financing...

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Unformatted text preview: Preferred Shares: Hybrid Financing o Characteristics possessed by All Preferred Shares Fixed rate of Dividend Payment of Dividends is Discretionary Non-Voting Shares Preference Rights vs Common Shares Liquidation Rights Dividend Rights Price Varies Inversely with Interest Rates o Characteristics Possessed by Some Preferred Shares The Cumulative Feature The call (Redemption) Feature The Convertible Feature The Participating Feature (example on Website) Alternative Types of Investments: Common Stock (p 319-324) Characteristics of Common Shares Voting Rights No Fixed Rate of Dividend Dividends are Variable and Discretionary Liquidation Rights Pre-Emptive Rights o How are Common Share Prices Determined? Stock Market Transactions (slides on Website) o Bid and Ask Price System o Market Orders to Buy and Sell Shares Short Sales o What is a Short Sale? A Step by Step Example of a Short Sale o Risks Associated with Short Selling No Theoretical Limit to Losses Termination of Short Selling Agreement Short Seller is Liable for Dividends Short Calls Short Selling Rule- No Date of Final Maturity o Perpetual Financing- Non Voting Shares- Preference Rights vs Common Shares o Dividends Cannot pay dividends to Common shareholders until all...
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This note was uploaded on 05/08/2011 for the course BUS 111 taught by Professor Jimmccutcheon during the Fall '09 term at Wilfred Laurier University .

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Lecture 8 notes Oct 13 - Preferred Shares: Hybrid Financing...

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