Understanding the Fifth-Letter Identifier "P" in Finance

Understanding the Fifth-Letter Identifier "P" in Finance

3 Min.

In finance, the letter "P" as a fifth-letter identifier in a stock ticker symbol signifies that the security is a first-preferred stock issue. Preferred shares provide certain advantages over common stock, such as higher priority and regular dividends. This article explores the concept of "P" as a fifth-letter identifier and its significance in the world of finance.


When "P" appears as the fifth letter in a stock's ticker symbol, it indicates that the security is a first-preferred stock issue. To understand the implications of this fifth-letter identifier, let's delve into the basics of preferred stocks and their characteristics.

What Is P as a Fifth-Letter Identifier?

Preferred shares, or preferred stock, are a type of equity investment that combines elements of both common stock and fixed-income securities. The key characteristics of preferred shares are as follows:

  1. Higher Priority: Preferred shareholders are granted higher priority compared to common shareholders in terms of both dividends and assets in the event of liquidation. This means they have a greater chance of receiving returns on their investment.
  2. Regular Dividends: Preferred stock typically pays regular dividends, which are often higher than those paid on common shares. These dividends provide a consistent income stream for investors.
  3. First-Issue Priority: When a preferred stock is designated as "first-preferred," it indicates that this class of preferred shares has priority over second or subsequent issues of preferred stock. This priority ensures that first-preferred shareholders receive their dividends and claims before other classes of preferred shareholders.

Other Fifth-Letter Identifiers

The term "fifth-letter identifier" is associated with stocks listed on the Nasdaq and Over-the-Counter Bulletin Board (OTCBB). These identifiers, ranging from A to Z, serve to convey specific characteristics of a security. Here are some examples:

  • A: Denotes Class A shares.
  • B: Denotes Class B shares.
  • D: Indicates new issues.
  • F: Represents foreign securities.

While most letters have consistent meanings on both Nasdaq and OTCBB, there are exceptions. For instance, OTCBB uses "Q" to signify companies involved in bankruptcy proceedings, while Nasdaq no longer uses this identifier. However, "P" consistently indicates first-preferred stock on both exchanges.

Priority and Ranking of Preferred Stock

Bondholders hold the highest position in the hierarchy of claim priority within a company, especially if they have secured bonds. Preferred shareholders, including first-preferred shareholders, fall in the middle, enjoying priority over common stockholders. This concept is known as "absolute priority" or "liquidity preference." In the unfortunate event of a company's bankruptcy, preferred shareholders are entitled to receive their claims before common stockholders receive anything.

When a company issues multiple classes of preferred stock simultaneously, they are ranked based on their priority. First-preferred shareholders hold seniority over second-preferred (marked with "O"), third-preferred (denoted by "N"), and fourth-preferred (indicated with "M") shareholders. However, it's important to note that first-preferred shareholders still come after prior-preferred stockholders and bondholders in terms of priority.


In the world of finance, the fifth-letter identifier "P" in a stock's ticker symbol carries significant implications. It indicates that the security is a first-preferred stock issue, offering investors various advantages. These advantages include higher priority in dividend payments and asset distribution. Understanding these fifth-letter identifiers is crucial for investors who want to make informed decisions in the stock market. These identifiers convey important information about a security's characteristics and its position in the company's capital structure.

New York Stock Exchange (NYSE)
P (Fifth-Letter Identifier)