Hey I am just skimming through the chapter 18 of the book intelligent investor by benjamin graham with commentary Jason Zweig. Pg:447 It basically compares Real Estate Investment Trust with Realty Equities Corp.of New York. It says that Realty Equities Corp entered to miscellany of ventures, backed by variety of corporate devices including. 1. A preferred stock entitled to $7 annual dividends, but with a par value of only $1, and carried as a liability at $1 per share.
What does this statement even mean? Does that mean that if I buy one preferred stock with preferred stock with $1 par or face value, then I will get $7 annual dividend? It seems ridiculous. And what extra information does liability at $1 per share give other than the preferred stock was issued with par value of $1 per share?