[Preferred Stock - What Albania can learn from US practice]

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ACKNOWLEDGEMENT

I would take this opportunity to thank my research supervisor, family and friends for their support and guidance without which this research would not have been possible.

DECLARATION

I, [type your full first names and surname here], declare that the contents of this dissertation/thesis represent my own unaided work, and that the dissertation/thesis has not previously been submitted for academic examination towards any qualification. Furthermore, it represents my own opinions and not necessarily those of the University.

Signed __________________ Date _________________

ABSTRACT

In this study we try to explore the concept of “Preferred Stock” in a holistic context. The main focus of the research is on “preferred stock” and its relation with “money supply and circulation in the country”. The research also analyzes many aspects of “preferred stock” and tries to gauge its effect on “the kind of operating benefits that preferred stock yields for stockholders”. In addition to this, a major aspect of understanding and comprehending the kind of problems and situations associated with the preferred stock evaluation and incorporation in the company have also been assessed and covered in this paper.

TABLE OF CONTENTS

ACKNOWLEDGEMENTII

DECLARATIONIII

ABSTRACTIV

INTRODUCTION1

Thesis Statement1

Previous literary findings1

CHAPTER 01: PREFERRED SHARES IN ALBANIA3

Opting for preference shares5

Current situation of the Albanian financial system6

CHAPTER 02: LEGAL FRAMEWORK OF DELAWARE8

Introduction8

The Albanian Economy10

Delaware Law: How does it work?12

The Risks Associated With Holding Preferred Stock14

The Agency Cost of Preferred Stock15

Board Features and Insider Ownership16

Convertibles as a Unique Asset Class17

Dividend Theories19

Transaction Costs20

External Finance24

Arguments and Debate29

Required Rate of Return (IRR): Influence and Changes within31

Analysis and Interpretations33

CHAPTER 03: A COMPARATIVE VIEW37

Previous Theoretical Research on preferred stock42

Research on the Valuation of Preferred Stock47

The smash of 2008 - Lehman Brothers55

Laws related to preferred stock: Evidence from available literature68

Promoting preferred shares73

CONCLUSION75

Key Findings75

Recommendations and Further Research77

REFERENCES78

INTRODUCTION

Thesis Statement

The thesis statement undertaken for this research shall be 'circulation of preferred stock in the Albanian economy'.

Previous literary findings

Shares have been divided and discussed widely in different contexts by different people. While majority of the literature runs on common stocks, preferred stock comparatively has been discussed on a relatively lesser note and seizes to exist as a point of discussion.

Considering the induction and elaboration of the distinct changes that have been done in the past regarding the changes and the challenges experienced over the years, the Albanian economy and the financial systems comes forth as an extreme case of existence, although it isn't rare to witness such a case in the region.

While many consider Albania as a sustainable market and that the expectations of current and potential investors are much associated with the changes and the challenges that are being experienced in line with the changes and the challenges portrayed over the years, there is a major possibility that the company would be able to make way for investing in an abyss of losses altogether.

Our basic understanding and focus on the realm of research as we speak implies the kind of research and analysis that has paved underway in the realm of financial stocks and shares, which are being ...