Adjustable-Rate Preferred Stock - ARPS

外汇网2021-06-19 16:13:32 203

A type of pferred stock where the pidends issued will vary with a benchmark, most often a T-bill rate. The value of the pidend from the pferred share is set by a pdetermined formula to move with rates, and because of this flexibility pferred prices are often more stable then fixed-rate pferred stocks.

Taobiz explains Adjustable-Rate Preferred Stock - ARPS

The pferred category of stocks are more secure as they will be one of the first of the equity holders to receive pidend payments in the event of the company's liquidation. There is often a limit to the amount the rate can change on the pidend, adding further security to the issue.

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