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It could be. That's the short answer. The longer answer depends entirely on your financial situation. How old are you? Have you retired? Are you approaching the age at which you'd like to retire? Firstly, no stock in any company is 100-percent secure, even if it's "preferred." And preferred stocks are treated differently by different publicly-traded companies. For example, the Ford Motor Company has issued stock of different terms over its 100-plus-year history, but given that its common stock is trading, as of this writing, at less than $3 per share, is there much more "security" in a preferred issue? And how does the issuing company pay dividends, if at all, on preferred stock? A company can change its mind about paying dividends on preferred issues. And if the company goes bust, the bondholders will be in line ahead of you at the fire sale. Secondly, if you have a few years remaining in the workforce, it's wise to consider that some of your assets, about one third, should be invested for growth. If you're looking for income security, bonds are a safer choice. Don't stray too far from the basic rules of asset allocation, and don't forget that the higher the return, the higher the risk. Here's an excellent article from USA Today about investing in preferred stocks: http://www.usatoday.com/money/perfi/columnist/krantz/2008-05-05-preferred-stock_N.htm Hope this helps.

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Q: Is a preferred stock an example of a variable income security?
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