What is the purpose of preferred shares? One wellknown investing web page explains that "preferred shares are a good alternative for riskaverse investors wanting to buy equities." Do you agree? Or is this the case of a financial instrument that has been created to fill a need that does not exist?

Corporate Finance, Third Edition Stephen J. Lubben

A. Common Shares pg.51 1. The Stock Market and IPOS pg.51 2. Legal Aspects of Share Ownership pg.53 3. A Note on the P/E Ratio and "Multiples" pg.55 B. Preferred Shares pg.56 1. Structural Issues (The Terms of the Deal) pg.57 Certificate of Designation of Terms of 6.75% Non-Cumulative Preferred Stock, Series Q pg.57 2. Fiduciary Duties to Preferred Shareholders pg.60 Marilyn Jedwab, Plaintiff, v. Mgm Grand Hotels, Inc., Tracinda Corporation, Kirk Kerkorian, James D. Aljian, Alvin Benedict, Fred Benninger, Barrie K. Brunet, Cary Grant, Peter M. Kennedy, Frank E. Rosenfelt, Bernard J. Rothkopf, Walter M. Sharp, Robert Van Buren, Bally Manufacturing Corporation, and Bally Manufacturing Corporation International, Defendants pg.61