callable preferred stock

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Callable Preferred Stock

A preferred stock that the issuing company may redeem under certain, stated circumstances. That is, the company may require the callable preferred stock to be exchanged for a given amount of cash. A company may issue callable preferred stock to protect itself from the possibility that its obligations to pay guaranteed dividends may become too expensive in the future.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

callable preferred stock

An issue of preferred stock that may be repurchased by the issuer at a specific price, usually par value or slightly above. The option to repurchase such stock is held by the issuer, not the investor. Calls can be expected when market rates of interest have fallen significantly below the yield on the preferred stock at the time the stock was issued.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
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