Trump labels Microsoft, Google, Amazon, Apple as MAGA stocks
President Trump celebrates stock market successes and the ‘trillion dollar companies,’ Microsoft, Apple, Google and Amazon.
At its most basic level, the stock market has a great deal in common with a supermarket.
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Not only does it offer a wide variety of products, they come in an array of types, brands, sizes and values. If you're interested in getting in on the longest-running economic expansion in U.S history and a market that may have more room for growth from recent record highs, here's a look at some of the variations you're likely to encounter.
Common vs. preferred shares
Don't let the terms fool you. One isn't necessarily better than the other — determining which to buy depends on what you want from it. Common stock, as the name suggests, is the bread-and butter version of a company's shares. It's available on the open market, meaning it can be purchased by anyone and is readily accessible on electronic trading platforms like E-trade.
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Owning a common share entitles the buyer to quarterly dividend payments, if any, and the right to vote on company policy, but owners rank behind both bondholders and preferred shareholders in recovery rights if the company fails.
Preferred shares typically come without the voting power of common shares, though their dividends are fixed for the life of the stock, unlike those for common stockholders, which are subject to change by the company's board. The dividends are also paid before those on common shares.
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Additionally, preferred stock doesn't always offer the open-ended ownership that common stock affords. It may be redeemable, meaning the company has the right to repurchase the shares when they reach a specified price, or convertible, which affords the owner the option of converting preferred shares to voting shares at a specified price point or after an agreed-upon time.