Should You Buy Preferred Shares of Fannie Mae and Freddie Mac?
Should You Buy Preferred Shares of Fannie Mae and Freddie Mac? By Alexander MacLennan | More Articles May 19, 2014 | Comments (0) This article is part of a series of articles that looks at Fannie Mae ( NASDAQOTCBB: FNMA ) and Freddie Mac ( NASDAQOTCBB: FMCC ) from an investment perspective. To read the full analysis, click here . Before the crisis, preferred stock in Fannie Mae and Freddie Mac was seen as a safe income security. As such, conservative investors and small banks purchased it. But when the GSEs melted down and required a bailout, preferred stock dividend payments were suspended and have yet to be resumed. Since the preferred stock available to private investors is junior to the senior preferred stock owned by the government, the junior preferred stock is in a similar situation as the common stock in that it provides no...