Strategic and Tactical Decision-making: DB5
Introduction: Preferred stock, warrants, convertibles, and options are hybrid securities that may perform like derivatives in certain market conditions. This paper is going to discuss preferred stock, warrants, and convertibles. It will seek to explain the characteristics of each as well as their uses. Each of the three has been discussed in depth below. Preferred stocks are also called preferred shares and are equity securities that have properties of both a debt and an equity instrument, and are considered hybrid instruments. Preferred stocks are having a higher ranking to subsequent common stock even though they are subordinate to bonds ...
