The main difference(s) between a preferred stock in Company A that pays a $2.50 per share annual dividend and a common stock in Company A that also pays a $2.50 per share current annual dividend is (are)
◦ the common stock has potential for price appreciation due to company earning s growth.
◦ the common stock dividend may increase but the preferred dividend is fixed in perpetuity.
◦ the common stock could lose value if the company performance were to suffer.
◦ All of these are real differences between preferred and common stock in the same company.