When investing in a company, there are two main types of shares you can buy: common shares and preferred shares. Common shares represent ownership in the company and give shareholders the right to vote on company matters. Preferred shares, on the other hand, do not come with voting rights, but they do offer some advantages over common shares, such as a higher dividend yield and priority in the event of a liquidation.
There are two main types of preferred shares: cumulative and non-cumulative. Cumulative preferred shares entitle the holder to receive all unpaid dividends before any dividends can be paid to common shareholders. Non-cumulative preferred shares, on the other hand, only entitle the holder to receive dividends for the current period.
