Updated: December 8, 2016
If you could earn 5% to 6% in income every year from a stock you don’t have to watch … you’d hold it today, right?
Well, if you don’t already, here’s your wake-up call.
Preferred stocks are a rarely talked about type of corporate equity that packs a one-two punch of high yield and low volatility. But that’s not why they’re called “preferred” – that moniker comes from the fact that preferred dividends take priority over common shares’ dividends, and must be paid out first. If a company wants to cut or suspend its payouts, it must do so to common shares before preferred shares.…