Preferred stocks often are referred to as hybrid investments. They offer advantages and disadvantages that are similar to stocks (equity securities) and bonds (debt instruments). While investment in preferred stock has increased steadily since the 1980s, investors and would-be investors are handcuffed by the lack of a standardized and comprehensive ticker-symbol language to designate preferred stocks. Finding a preferred stock on the New York Stock Exchange (NYSE), for example, requires the use or input of a different symbol than it does for finding the same stock on the Nasdaq.
Investigate publications such as Investor’s Business Daily and The Wall Street Journal. These publications have their own ticker-symbol codes. which differ from most other publications, exchanges and online sites. The Wall Street Journal, for example, lists the primary Ford Motor Company preferred stock (Ford has four entities listed with preferred stocks) under the symbol “F + A.” Compare that with other listings, such as the NYSE’s listing of Ford preferred as “FPRA” (the “PR" indicates the preferred status).
Study major market indexes, such as the Dow Jones, the S&P 500, NASDAQ, AmEx and the Russell 2000 Index. Most have their own, unique preferred stock symbol coding. Most also list preferred stocks on separate tables for easier reference, and some offer the option of typing in either the primary stock symbol (such as “F” for Ford) or the company name and searching for preferred stock listings.
Research the major stock exchanges. There are hundreds of stock exchanges worldwide--and each has its own language. Although companies generally are listed on only one exchange, some companies--Walgreen’s and Hewlett-Packard (NYSE and Nasdaq), for example--trade on more than one. Multinational companies also trade on multiple exchanges. The three largest exchanges in the world are in New York, Tokyo and London.
Visit online web sites dedicated to financial, investment and business news, such as Bloomberg, Forbes, Kiplinger and Morningstar. They, too, have their own coding systems for preferred stocks--but most offer the alternative of simply entering the name of the company or the common stock symbol. A listing of all the company’s stocks, including preferred shares, then is displayed. These independent sites usually can interpret most ticker symbols that you enter, and they also offer analysis and news articles about preferred stocks (almost always with links to that particular stock or company).
Read company balance sheets. Preferred stock is listed first in the stockholders' equity section due to its preference in dividend payments and liquidation considerations.
Hire a broker--brokerage houses obviously will have access to the latest information about preferred stocks.
Because of the nature of preferred stocks--they are volatile, and they are issued and recalled frequently--no permanent listing similar to common stock and mutual fund lists of preferred stock really exists. However, different online sites do post preferred stock listings (usually partial or categorized lists), and update and analyze preferred stocks regularly.
Be prepared to be head-swimmingly confused if this is your first foray into preferred stock listings. Even veteran traders get bewildered at the jumble of symbols.
Many online sites are subscription only. Read all instructions and disclaimers carefully.
- new york stock exchange image by Gary from Fotolia.com