{"id":12249,"date":"2022-06-08T11:12:31","date_gmt":"2022-06-08T05:42:31","guid":{"rendered":"https:\/\/kuvera.in\/blog\/?p=12249"},"modified":"2022-07-14T16:49:09","modified_gmt":"2022-07-14T11:19:09","slug":"preference-shares","status":"publish","type":"post","link":"https:\/\/kuvera.in\/blog\/preference-shares\/","title":{"rendered":"Preference Share: Definition, Types, and Features"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_40 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" area-label=\"ez-toc-toggle-icon-1\"><label for=\"item-69e18fdb6733d\" aria-label=\"Table of Content\"><span style=\"display: flex;align-items: center;width: 35px;height: 30px;justify-content: center;direction:ltr;\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/label><input  type=\"checkbox\" id=\"item-69e18fdb6733d\"><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Types_of_Preference_Share\" title=\"Types of Preference Share\">Types of Preference Share<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Convertible_shares\" title=\"Convertible shares\">Convertible shares<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Non-convertible_shares\" title=\"Non-convertible shares\">Non-convertible shares<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Cumulative_preference_shares\" title=\"Cumulative preference shares\">Cumulative preference shares<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Non-cumulative_preference_shares\" title=\"Non-cumulative preference shares\">Non-cumulative preference shares<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Participating_preference_share\" title=\"Participating preference share\">Participating preference share<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Non-participating_preference_share\" title=\"Non-participating preference share\">Non-participating preference share<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Redeemable_preference_shares\" title=\"Redeemable preference shares\">Redeemable preference shares<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Non-redeemable_preference_shares\" title=\"Non-redeemable preference shares\">Non-redeemable preference shares<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Preference_shares_with_call_option\" title=\"Preference shares with call option\">Preference shares with call option<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Adjustable_preference_shares\" title=\"Adjustable preference shares\">Adjustable preference shares<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Features_of_Preference_Shares\" title=\"Features of Preference Shares\">Features of Preference Shares<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Preferential_treatment\" title=\"Preferential treatment\">Preferential treatment<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#No_voting_right\" title=\"No voting right\">No voting right<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Convertibility\" title=\"Convertibility\">Convertibility<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Liquidation\" title=\"Liquidation\">Liquidation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Callability\" title=\"Callability\">Callability<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Why_Should_One_Invest_in_Preference_Shares\" title=\"Why Should One Invest in Preference Shares?\">Why Should One Invest in Preference Shares?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Risks_of_Preference_Shares\" title=\"Risks of Preference Shares\">Risks of Preference Shares<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Can_a_company_issue_preference_shares_at_a_premium\" title=\"Can a company issue preference shares at a premium?\">Can a company issue preference shares at a premium?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#How_to_buy_preference_shares\" title=\"How to buy preference shares?\">How to buy preference shares?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#What_is_the_difference_between_preference_shares_and_bonds\" title=\"What is the difference between preference shares and bonds?\">What is the difference between preference shares and bonds?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-23\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/#Interested_in_how_we_think_about_the_markets\" title=\"Interested in how we think about the markets?\">Interested in how we think about the markets?<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>Preference shares, also known as preferred stock, are among the two types of shares that a company issues. The other type is equity shares. Whenever a company decides to pay out dividends, preference shareholders have the first right to receive them before equity shareholders. Capital raised while issuing preference shares is called preference share capital.<\/p>\n<p>&nbsp;<\/p>\n<p>Whenever a company goes for liquidation or winding up, the preference shareholders have first right over the company&#8217;s assets. Companies must redeem these shares within 20 years from the date of issue as per the Companies Act, 2013. In India, companies cannot issue non-redeemable preference shares meaning that they do not have any option to buy back these shares.<\/p>\n<p>&nbsp;<\/p>\n<p><a href=\"https:\/\/kuvera.in\/explore\/fixed-deposit\/c\/all\"><img loading=\"lazy\" class=\"size-large wp-image-13417 aligncenter\" src=\"https:\/\/kuvera.in\/blog\/wp-content\/uploads\/2022\/07\/FD-Banner_14-July-2022-1024x334.jpg\" sizes=\"(max-width: 640px) 100vw, 640px\" srcset=\"https:\/\/kuvera.in\/blog\/wp-content\/uploads\/2022\/07\/FD-Banner_14-July-2022-1024x334.jpg 1024w, https:\/\/kuvera.in\/blog\/wp-content\/uploads\/2022\/07\/FD-Banner_14-July-2022-300x98.jpg 300w, https:\/\/kuvera.in\/blog\/wp-content\/uploads\/2022\/07\/FD-Banner_14-July-2022-768x250.jpg 768w, https:\/\/kuvera.in\/blog\/wp-content\/uploads\/2022\/07\/FD-Banner_14-July-2022.jpg 1080w\" alt=\"Online Fixed Deposits on Kuvera\" width=\"640\" height=\"209\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Types_of_Preference_Share\"><\/span>Types of Preference Share<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Here is a list of preference shares that a company can offer to potential investors:<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Convertible_shares\"><\/span>Convertible shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>According to the memorandum of association, one can easily convert these shares into equity shares at a particular price and before a specific period. Investors opt for this type of share as they can enjoy two benefits. One is a dividend offered by the company, and another is the returns one can earn in case the value of the stock appreciates.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Non-convertible_shares\"><\/span>Non-convertible shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>These shares are never converted into equity shares. However, they retain all other benefits of preference shareholders like a fixed dividend and first right over the company&#8217;s assets in case of liquidation.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Cumulative_preference_shares\"><\/span>Cumulative preference shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Cumulative preference shares entitle shareholders to receive a cumulative dividend. There may be years in which a company is not making any profits, so it does not pay any dividends. However, all these dividends are accumulated as arrears and paid to shareholders cumulatively in the year in which the company earns profits.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Non-cumulative_preference_shares\"><\/span>Non-cumulative preference shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Shareholders of non-cumulative shares will receive dividend payouts only when a company earns profits. Conversely, if the company is incurring losses, shareholders will not receive any dividend, nor can they claim dividend arrears in any future profit-making year.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Participating_preference_share\"><\/span>Participating preference share<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>These shares provide unique benefits to shareholders. One is eligible for an additional dividend over and above the fixed preference dividend. The participating preference shareholders can also claim surplus profits and equity shareholders during the company&#8217;s liquidation.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Non-participating_preference_share\"><\/span>Non-participating preference share<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>These shareholders are not eligible to receive any additional dividend apart from the regular preference dividend. Individuals do not have any right over surplus profits on par with equity shareholders.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Redeemable_preference_shares\"><\/span>Redeemable preference shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>As the name suggests, the company must redeem these shares at a predetermined price and within a specific timeframe. The price and time on which these shares may be redeemed are distinctly mentioned in the memorandum.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Non-redeemable_preference_shares\"><\/span>Non-redeemable preference shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Companies cannot redeem these shares during their lifetime. Companies may go for the redemption of preference shares only during liquidation or winding up.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Preference_shares_with_call_option\"><\/span>Preference shares with call option<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Companies issuing these shares have a right to buy back these shares at a particular price. This call in only happens after a specific period. Companies mention the premium amount in case of share buy back in their prospectus.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Adjustable_preference_shares\"><\/span>Adjustable preference shares<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>These shares come with a variable dividend rate. The Dividends depend on the prevailing market rates and hence are highly volatile.<\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Features_of_Preference_Shares\"><\/span>Features of Preference Shares<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The features of preference shares are as follows:<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Preferential_treatment\"><\/span>Preferential treatment<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>As per their name, preference shares have certain preferential rights over other common stockholders. These shareholders will always receive dividends ahead of equity shareholders.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"No_voting_right\"><\/span>No voting right<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Preference shareholders do not have any voting rights. Therefore, they cannot participate in the decision-making process of the company.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Convertibility\"><\/span>Convertibility<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Some preference shares come with an option that they can be converted into equity shares. This conversion takes place at a specific price and only after a specified date. Some conversions can happen automatically after a certain time period, while others require prior approval from the board.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Liquidation\"><\/span>Liquidation<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>In case of liquidation, preference shareholders have the first right over a company&#8217;s stock or assets. These shareholders have precedence over equity shareholders, and only after the company settles claims of preference shareholders can the claims of equity shareholders be entertained.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Callability\"><\/span>Callability<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Companies can call in or buy back these shares according to the terms mentioned in the memorandum.<\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Why_Should_One_Invest_in_Preference_Shares\"><\/span>Why Should One Invest in Preference Shares?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>&nbsp;<\/p>\n<p>Preference shares have certain privileges that make these assets a very lucrative option. Some reasons why you may consider buying preference shares are as follows:<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">First, the shareholders will receive dividends before ordinary equity shareholders.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">If the company does not earn any profits, then dividends due to these shareholders are accrued and cumulatively paid in the year it starts generating profits again.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">In liquidation, preference shareholders will have first right over the company&#8217;s assets.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Some preference shareholders come with a conversion option into<a href=\"https:\/\/app.kuvera.in\/explore\/stocks\/c\/all\"> equity stocks<\/a>. If the value of common stocks appreciates, you can convert your shares into equity and enjoy gains arising from them.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Risks_of_Preference_Shares\"><\/span>Risks of Preference Shares<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Here are the dangers of preference shares:<\/span><\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Unlike equity shareholders, the shareholders of preference shares do not have any voting rights. They do not have any ownership in the company and cannot have a say in any decision-making process.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Preference shares come with a fixed dividend. So, if market interest rates increase, these shareholders will lose out on additional gains or interest that they may earn.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>Pro Tip: Did you know? If you have invested in stocks, you can import your portfolio to <a href=\"http:\/\/app.kuvera.in\">Kuvera<\/a> and get a consolidated view of your entire investment portfolio, including\u00a0 <a href=\"https:\/\/kuvera.in\/explore\/mf\/c\/all\">Mutal Funds<\/a>, <a href=\"https:\/\/kuvera.in\/explore\/stocks\/c\/all\">Stocks<\/a> and EPF.<\/p>\n<p>&nbsp;<\/p>\n<p><b>Final Word<\/b><\/p>\n<p>Preference share are a hybrid investment instrument as they exhibit both debt and equity qualities. Risk-averse investors can go for preference shares as these come with fixed dividends. However, individuals with a high-risk appetite may not prefer them.<\/p>\n<p>&nbsp;<\/p>\n<p><b>Frequently Asked Questions<\/b><\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"Can_a_company_issue_preference_shares_at_a_premium\"><\/span>Can a company issue preference shares at a premium?<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Yes, a company can issue preference shares at a premium.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"How_to_buy_preference_shares\"><\/span>How to buy preference shares?<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>One can purchase preference shares from the primary market (IPO\/FPO) and the secondary market. One needs to open a Demat account with a registered broker and invest a certain amount to purchase preference shares.<\/p>\n<p>&nbsp;<\/p>\n<ul>\n<li aria-level=\"1\">\n<h4><span class=\"ez-toc-section\" id=\"What_is_the_difference_between_preference_shares_and_bonds\"><\/span>What is the difference between preference shares and bonds?<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Preference shares and bonds have specific differences based on dividend payments and liquidity. Dividends in the case of preference shares are fixed but not guaranteed. However, interest on bonds has to be paid. On the other hand, these shares are more liquid than bonds.<\/p>\n<p>&nbsp;<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Interested_in_how_we_think_about_the_markets\"><\/span>Interested in how we think about the markets?<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>Read more: <a href=\"https:\/\/kuvera.in\/blog\/category\/zen-and-the-art-of-investing\/\" target=\"_blank\" rel=\"noopener noreferrer\"><strong>Zen And The Art Of Investing<\/strong><\/a><\/p>\n<p>Watch\/hear on YouTube:<\/p>\n<p>&nbsp;<\/p>\n<p><iframe loading=\"lazy\" title=\"EPF, PPF and VPF | Tax Saving Investments for Guaranteed Returns\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/dbxbBR7it10?list=PLDSzQdT9nLmBFD2p94O5p2pZ4vEUR-Thz\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture\" allowfullscreen><\/iframe><\/p>\n<p>&nbsp;<\/p>\n<p>Start investing through a platform that brings goal planning and investing to your fingertips. Visit <a href=\"https:\/\/app.kuvera.in\/\">Kuvera.in<\/a> to discover <a href=\"https:\/\/kuvera.in\/blog\/direct-plans-better\/\">Direct Plans<\/a> and <a href=\"https:\/\/app.kuvera.in\/explore\/fixed-deposit\/c\/all\">Fixed Deposits<\/a> and <a href=\"https:\/\/kuvera.in\/user\/login\">start investing today.<\/a><\/p>\n<p>#MutualFundSahiHai #KuveraSabseSahiHai!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Preference shares, also known as preferred stock, are among the two types of shares that a company issues. The other type is equity shares. Whenever a company decides to pay out dividends, preference shareholders have the first right to receive them before equity shareholders. Capital raised while issuing preference shares is called preference share capital. [&#8230;]<\/p>\n<p><a class=\"btn btn-secondary understrap-read-more-link\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/\">Read More&#8230;<\/a><\/p>\n","protected":false},"author":11,"featured_media":12251,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false},"categories":[99,679],"tags":[925,924],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Preference Share: Definition, Types, and Features - Kuvera<\/title>\n<meta name=\"description\" content=\"Preference share of preferred stocks are shares of company stocks with dividend which are paid to stock holders before stock dividends issued.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/kuvera.in\/blog\/preference-shares\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Preference Share: Definition, Types, and Features - 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