What are Preference Shares?

What are Preference Shares?

Preference shares, also known as preferred stocks, are stock issued by a company that pays dividends to its shareholders.

Preference shares are typically issued to raise cash for a corporation, which is referred to as preference share capital.

Preferred shareholders are part-owners of a company, but they do not have voting rights, unlike common shares.

Preference shares have a preferential right when it comes to dividend distribution of dividends or during the liquidation of a company.

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