As a lay person, signing up for Scott Trade or other trading websites, am I buying and selling common or preferred stock?
If it is common, how is it possible that I have voting rights then? How do I vote?
John W
Favorite Answer
Common stock is a share of ownership, preferred stock isn't, it's simply a defined share of the profits. The differences are profound and affect how the shares are priced. As to voting, when you have a brokerage account, all the shares are kept in the broker's name, when there is a vote to be held, the broker will send you documents to sign the proxy vote over to him. Of course you have the right to go to the shareholders meeting and vote or mail in your vote but most people just let the brokerage firm have the vote.
You do need to read some of the more basic books on investing.
You can buy and sell either common or preferred shares with a brokerage account but the shares you hear people talking about are all common shares.
thomas p
Common. Preferred is a bit of a blend of stock and bond.
?
Given that you asked these questions, you shouldn't be "trading" at all.
Edit: I get thumbs down on this response. I'm the guy speaking sense to this poster. Everyone he will be trading stocks against knows way more about it than him. Is it really nice to just lead him to slaughter? Giving him a lecture about what preferred stock is won't help anything.
Anonymous
you're evaluating apples and oranges. the two can value extra or under the different. in case you very own hassle-loose inventory, you very own somewhat the organization. possessing favorite inventory would not provide you any possession contained in the organization. It ability you have lent the organization funds. they might desire to pay you your dividend (interest) in the previous they pay any dividends to trouble-loose inventory proprietors.
Ryan M
99% of the time it is common.