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Preferred habitat theory |
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Preferred habitat theoryA biased expectations theory that believes the term structure reflects the expectation of the future path of interest rates as well as risk premium. The theory rejects the assertion that the risk premium must rise uniformly with maturity, but instead profits that to the extent that the demand for and supply of funds do not match for a given maturity range, some participants will shift to maturities showing the opposite imbalances, as long as they are compensated by an appropriate risk premium whose magnitude will reflect the extent of aversion to either price or reinvestment risk.Preferred habitat theory Similar MatchesSecond preferred stockSecond preferred stockPreferred stock issue that has less priority in claiming dividends and assets in liquidation than another issue of preferred stock. Preferred stock agreementPreferred stock agreementA contract for preferred stock. Blank Check Preferred StockBlank Check Preferred StockThis is stock over which the board of directors has broad authority to determine voting, dividend, conversion, and other rights. While it can be used to enable a company to meet changing financial needs, its most important use is to implement poison pills or to prevent takeover by placement of this stock with friendly investors. Convertible preferred stockConvertible preferred stockPreferred stock that can be converted into common stock at the option of the holder. See also: participating convertible preferred stock. Preferred dividend coveragePreferred dividend coverageNet income after interest and taxes (before common stock dividends) divided by preferred stock dividends. Further SuggestionsAuction rate preferred stock (ARPS)First preferred stock Preferred equity redemption stock (PERC) preferred stock Preferred stock ratio Dutch Auction Preferred Stock adjustable rate preferred stock Participating preferred stock Prior preferred stock Floating rate preferred Auction Market Preferred Stock (AMPS) Monthly income preferred security (MIP) Cumulative preferred stock cumulative preferred stock Adjustable rate preferred stock (ARPS) participating preferred stock Depository preferred Preferred stock |
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