If they are not junk bonds, then why not select the common and dispense with the upside limitations that exist with the preferred? As a fixed income investment, assuming your allocation targets and needs at the moment demand something in the high yield, relatively higher-risk area, and assuming your analysis is correct, and I would guess there's a very good chance that it is -- considering what I've seen (rough take) looking at paper stocks, it certainly sounds like a good choice. However, the concern does remain, longer term, that a preferred stock tends to be senior only to the common in terms of priority, should the company run into serious (fundamental) trouble, somewhere down the road. Whether that risk is significant now or not, it remains a risk for the lifetime of the security. Which is not to pass judgement on the preferred... it remains somewhat less risky than the common, and does, in any case, offer those dividends, which may be very useful to someone who requires a steady flow of income from their capital, assuming the yield is reasonably secure. Are there any provisions in the prospectus that allow GP to suspend the coupon payments? Any other adverse factors there that may explain the premium, aside from the whims of the market (which are quite possibly all the explanation needed)?
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