True, cumulative preferred stock can be purchased by anyone, but it is more likely that someone over 50 would be interested in such an investment.
A type of preferred stock known as cumulative preferred stock has a clause stipulating that dividends must be paid to cumulative preferred owners first if any past dividend payments have been missed. Dividend payments must be made prior to other classes of preferred stock shareholders and common stockholders. The terms cumulative preferred stock and cumulative preferred shares are also used. This class of shareholders will get payment before holders of other classes of preferred stock and holders of common stock.
In contrast to non-cumulative preferred stock, which does not issue omitted or unpaid dividends, shareholders of cumulative preferred stock simply miss out on any dividends that are not paid in a given quarter or year.
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