Zero-Dividend Preferred Stock

Definition of 'Zero-Dividend Preferred Stock'


A preferred share that is not required to pay a dividend to its holder. The owner of a zero-dividend preferred share will earn income from capital appreciation and may receive a one-time payment at the end of the investment term. Also referred to as "capital shares".

Investopedia explains 'Zero-Dividend Preferred Stock'


Owners of zero-dividend preference shares will not receive a normal dividend. Often, they still maintain reimbursement priority over common shareholders in the event of bankruptcy. While a company may structure preferred shares however they choose, most preferred shares will not have voting rights.



Related Video for 'Zero-Dividend Preferred Stock'

comments powered by Disqus
Hot Definitions
  1. Direct Bidder

    An entity that purchases Treasury securities at auction for a house account rather than on behalf of another party.
  2. Mortgage Modification

    A permanent change in a homeowner's home loan terms that makes the monthly loan payments affordable.
  3. Leveraged Benefits

    The use – by a business owner or professional practitioner – of their company’s receivables or current income to secure a loan whose proceeds then indirectly fund a retirement plan.
  4. Direct Consolidation Loan

    A loan that combines two or more federal education loans into a single loan. A Direct Consolidation Loan allows the borrower to make a single monthly payment. The loan is facilitated by the U.S. Department of Education and does not require borrowers to pay an application fee.
  5. Through Fund

    A type of target-date retirement fund whose asset allocation includes higher risk and potentially higher return investments "through" the fund's target date and beyond.
  6. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold or disposed of first.
Trading Center