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Unformatted text preview: A.
1. Fixed payouts like bonds
2. An equity investment like common B. Attributes Of Preferred Stock
5. Par value; meaningful in bankruptcy or liquidation
Cumulative Features; missed dividends must be made up
Participating; in years of high profits, an extra dividend
Non-Voting; except as provided in corporate charter
Convertibility; typically into common All Rights Reserved Dr. David P Echevarria 5 NEW ISSUES OF STOCK (IPOS)
A. Typically below current market prices
4. Developing Prospectus
Price the issue
Distribute the issue
Transaction Costs: Spread, fees C. Shelf Registrations
1. Corporation can plan issues up to two years to
2. Permits issuer to time issuance for best price action
All Rights Reserved Dr. David P Echevarria 6 SECURITY MARKETS
A. Organized Exchanges
1. NYSE, AMEX, Tokyo (TSE), London (LSE), etc
2. Restricted participation, trading rules strictly
3. Traders (members) own seats...
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- Fall '09