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 preference holders have only themselves to take care of them.

Such things happen when things go wrong. But then, when things go wrong, all the investors in all the securities of the company concerned are bound to be affected. They are like a row of ninepins—if the first one hit by misfortune, the ordinary shareholder, is hit hard enough to fall over he will hit the preference holder; and if he does so hard enough to knock him over, the debenture holder will not escape without a blow; if he still gets his interest he will not be feeling nearly so comfortable about his investment, and if he happens to want to sell, the fact the preference and ordinary are paying nothing will make a serious difference to the price that he will get in the market.

Nevertheless the right to take interest or dividend ahead of somebody else is always a comfort to those who like the safe side and are ready to pay for it by taking a lower rate of interest. When things go wrong the other fellow is hit first, and if they go only a little wrong the preference holder is not hit at all. Many investors look with satisfaction on a nice collection of well-chosen preference shares; they are confined to their fixed rate—or usually so—and may sometimes look with envy at the