Preference shares are quite similar to bonds. Unlike bonds, preference shares might not be able to pay out dividends in certain years, but that usually means that the ordinary shares holders won't get their dividends too. If bond issuers are unable to pay out coupons, they will be in default and that's very serious because it means that a lot of debtors will also be howling for their blood.

Click for a bigger pic. Check the data yourself, I might be wrong.

I've written extensively about the basics of preference shares so I'm not going to repeat. Here's a backlog of articles if you want to find out more: 1. Preference shares Part I 2. Preference shares Part II 3. Preference shares Part III 4. Preference shares Part IV   5. Hyflux preference shares Part 1, 2, 3                   ......