Why are common stockholders considered to be more at risk than the hol

QUESTION

Why are common stockholders considered to be more at risk than the holders of other types of securities?
Common stockholders are considered to be at more risk than the holders of other type of securities because the common stockholders are paid any amounts either with regard to the the dividends or the redemption amount at the time of liquidation only after the holders of all other securities have been paid the amounts associated with the securities held by them¦.

The common stockholders are paid any dividend only after the payment of interest and preference dividends and the redemption amount on liquidation is paid to the common stockholders only after the claims of all the other securities are met.

ANSWER:

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