MANAGEMENT

Detailed explanation-1: -MIPS is a hybrid security, combining features of preferred stock and corporate bonds. Q. Preference shares are called securities, as these shares have the features of equity shares and debentures.

Detailed explanation-2: -Example: Convertible Bonds The most common example of a hybrid security is called a “convertible bond.” This is a bond that comes with an option to convert the instrument into a different type of security at a future date.

Detailed explanation-3: -Preference shares are called hybrid securities, as these shares have the features of equity shares and debentures. Like equity shares, preference shares receive dividend only when the company is earning a profit; like debentures, preference shares get a fixed rate of return.

Detailed explanation-4: -There are three broad types of hybrid securities – convertibles, preference shares and capital notes.

Detailed explanation-5: -Answer and Explanation: Preferred stock is referred to as a hybrid security because it has features of both common stock and bonds. Like common stock shares, preferred stock shares have an infinite life and pay dividends to their holders.