Chapter 4 preview
Chapter 4: Equity Securities
Chapter 4 covers equity securities: the rights of common and preferred shareholders, how ADRs work, market structure, and the tax treatment of dividends and capital gains. Preferred stock comes in several forms — cumulative, non-cumulative, participating, and convertible — and each has different rules. The ex-dividend and record dates determine who receives dividends. Preemptive rights protect existing shareholders from dilution.
Chapter summary
Chapter 4 covers equity securities: the rights of common and preferred shareholders, how ADRs work, market structure, and the tax treatment of dividends and capital gains. Preferred stock comes in several forms — cumulative, non-cumulative, participating, and convertible — and each has different rules. The ex-dividend and record dates determine who receives dividends. Preemptive rights protect existing shareholders from dilution.
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Key concepts
- The Corporation
- Preferred Stock
- Penny Stock Regulations
- Derivative Securities
- American Depositary Receipts (ADRs)
- NYSE and Nasdaq-Listed Securities
- OTC Equities-Non-Exchange Securities
- Tax Issues Associated with Equity Securities
- Capital Gains and Losses
- The Corporation
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