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The “tit in hand” theory says that investors prefer stock dividends over potential capital gains due to the uncertainty of capital gains. A buyout is a reference to an investor buying back shares because the original seller was unable to deliver the shares as promised. Cash dividends are payments made by a company to its shareholders in the form of periodic cash distributions (as opposed to shares or any other form). Ordinary shares are securities representing ownership of a corporation. Compound interest is a process in which interest is credited to the existing principal as well as to the interest already paid. Most interest is accrued every six months, quarter or month. Convertible preferred shares are a type of preferred shares that pay dividends and can be converted into ordinary shares at a fixed conversion rate after a certain period of time. Shares are dividend, which means “with dividend” when the company has declared that the dividend will be in the future, but has not yet paid them. Cyclical stocks are affected by macroeconomic changes when their returns match the cycles of the economy. A debt/equity swap involves an exchange of capital for debt in order to write off money owed to creditors.