why zero dividend preferred stock is issued
companies that are likely to issue zero dividend preferred stock include investment trusts particularly those that may face challenges getting long term debt approved zero dividend preferred stock usually comes with a specific time period issuing zero dividend preferred stock is a way for an investment trust to raise capital that is easier than seeking a loan from a bank and oftentimes lasts much longer than a bank would typically be willing to lend for zero dividend preferred stock also comes with fewer restrictions than a bank would include in a loan a zero dividend preferred stock raises capital holds no voting rights and doesn t pay out a dividend it s an extremely attractive option for a company to issue advantages and disadvantages of zero dividend preferred stockthere are many advantages and disadvantages for an investor that come with a zero dividend preferred stock 