Question

You have just been to see your broker at Acclaim Capital Inc. for advice about investing in the Empire Bank. The broker indicates that the Empire Bank has three different types of securities: debt, preferred shares, and common shares. She states: “Debt is safe because it is a bank and Canadian banks are safe. Empire Bank preferred shares entitle you to vote at the annual general meeting. The Empire Bank has paid a common share dividend of $2.50 per year for the past 18 years so you are guaranteed to receive $2.50 next year; if you don’t, the bank will go bankrupt.” Comment on your broker’s statement. Is she correct?



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  • CreatedFebruary 25, 2015
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