A preferred stock that has its dividends set at a fixed monetary amount or a percentage of its par value (par value of the stock) as defined on its certificate. The dividend rate of this stock is predetermined and will not experience any changes over time. For its entire term, this stock pays a fixed dividend.

Certain types or series of preferred stock has no maturity date. Dividends are typically noncumulative, and only payable when and if declared by the issuer’s management. These securities rank above the issuer’s common stock and are subordinated to the issuer’s outstanding senior unsecured debts.