Common Stocks vs Preferred Stocks | Similarities and Differences

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Common Stocks vs Preferred Stocks | Similarities and Differences

In this video, we're going to explain the differences between common stocks and preferred stocks.

While they're both stocks in companies and entitle the investors to a claim on profits and assets, common shareholders have a higher return and risk potential than preferred shareholders. That's because common shareholders are subject to greater stock price movements and because preferred shareholders have a higher claim than the common shareholders.

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As an lnvesting enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?.

Bismarksolomon

Return on capital is not guaranteed in common stock. Return is guaranteed in preferred stock at fixed rate. Growth potential is high in common stock. Growth potential is low in preferred stocks.

patelvidhu

Every week I buy more of whatever is the lowest percentage of my portfolio and try to keep everything around 10%. Please what could be my safest buys with $400k to outperform the market in 2024?

Elizabeth-mhdj

Excellent video. Thank you so much. Would definitely prefer common stocks because of upside potential. You can always sell stocks when stock market is rumbling and shares go on a downward slide. And from all what my experience is: in the event of an insolvency bonds have preferred status over preferred stocks when it comes to claims on company's assets. So in case bond holders are paid there will not be much left for preferred stock holders.

SandalinaEvi

Thanks for the breakdown. I literally read a article about a certain company earlier this morning and i bought $500 worth of their preferred stock. I honestly didnt even know what it was. I just had a random amount of money to play with so i said "fuck it." I usually only buy common stocks but now, ima set my portfolio up to where 10% of it is preferred stocks

jaystew

love the video! thanks, I was preatty confused after professor's lesson

alessandrolagi

Thank you so much for making this video. As a beginner in stock market this video helped me a lot. As assured with other beginners like me. Thank you! 😊

jonalyn

Thanks a lot. I didn't know the difference until now... and I think it's an important one...

MrBlackstonia

Not all preferred stocks are publicly traded.
And Preferred stocks dividends can be paid out of operating income not net income.

shiftstart

definitely on preferred cause no matter what the company gains they must go through the preffered shareholder first and that locks in a stable connection of profit going from the company to the shareholder itself so for me its better stable than nothing!

adultman

thank you, very concise and clear . right now at this point in my life I'm more of a common stock holder, at the same time I hope to one day have enough I can live on dividends alone or the the interest and never touch the principle

yang

Thank you for the video! It helped me to understand the difference between the common stock and the preferred stock! Pressed the like button.

honggwan.

Preferred stocks are good for retired people who don't want risk. You can also buy ETF's that hold preferred stocks, like SPHD, PGX, etc.

JackAgainski

Thank you for the super clear and no fluff explanation

DanielChar

Preferred Stock for me.
I will be a pensioner soon. I dont want to take high risk.
Enough return to counter inflation is sufficient.
As long as I can buy doughnut & coffe, I'm okay.

azhanali

Thank you so much🔥because of this video the confusion was cleared and I will pass my exam today

vimbayimatunga

Thank you. This is the information I was looking for. Much appreciated 🙂

ZsEver

This video is such a gem. Thank you very much.

sabrinaalam

How do you get to invest in preferred stocks?

sterlingphoenix

Great job! This was an excellent explanation. 😊

ejandreoni

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