$25 Par Preferred Securities

Specifically designed for individual investors, $25 par preferred securities constitute virtually all of the newly-issued preferred securities brought to market as well as most of the preferred securities available in the secondary market.

Also known as “synthetic preferred” or “fixed-rate capital securities,” securities with a $25 par value are denoted by many acronyms, including QUIDS, QUIPS and SATURNS.

Like traditional preferred stock, $25 par preferred securities:

• are generally listed on the NYSE, AMEX or NASDAQ, providing liquidity at market prices, which can be more or less than $25

• generally provide a fixed yield and a predictable income stream

• interest must be paid before common stockholder dividends

• are assigned credit quality ratings that have been, in most cases, investment grade quality

• can be called prior to maturity, typically at par, and offer a call protection period, generally five years from issuance.

However, $25 par securities offer additional investment advantages. They:

• typically provide higher current yields than comparable-quality corporate bonds

• generally pay interest on a quarterly basis, and

• have set maturity dates, generally ranging from 30 to 50 years.