Are Preferred Stocks a Smart Investment Choice?
Even the most novice investor understands what a share of stock is: one small piece of a company. When the company rises in value, so does your piece. Likewise, corporate bonds are fairly straightforward: They represent money the company is borrowing, which gets paid back to the holder, with interest.
But then there are slightly more arcane assets, like preferred stock. The name alone makes it sound like you should want some in your portfolio, and Rule Breaker Investing listener P.T. Lathrop is interested. In this segment of the mailbag podcast, host and Motley Fool co-founder David Gardner, Motley Fool Chief Investment Officer Andy Cross, and senior analyst Jim Mueller cover the basics of what preferred stocks are, their pros and cons relative to regular shares, who buys them, and what role they can play in a portfolio.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. A full transcript follows the video.
Source Fool.com
