\t\t\tDefinitionAlso known as ordinary\xa0shares. Equity share is the foundation of the company as it raises fund. These cannot be converted to preference sharesPreference shares\xa0are the shares which promise the holder a preference over the equity shares. These can be converted to equity sharesDividendEquity shares do not have right to receive dividendUnder this the rate of dividend is fluctuatingUnder preference shares, based on time, cumulative or non-cumulative are entitled for the dividendHere, the rate of dividend is fixedVoting rightsVoting rights under general meetingDo not have any voting rightsTypesThese are considered as ordinary shares and thus they do not have any typesThese come in various types like: Convertible and non-convertibleCumulative and non cumulativeNon participatory, etc.LiquidationDuring liquidation, shareholders will have residual right over the asset even after the repayment to preference shares of the companyThe shareholders will have first right after the repaymentParticipation rightsThey are primarily responsible for the management of the companyDo not have any participation rights in the company\'s management\t

1.	What is the difference between equity shares and preference shares? Which is more advantageous
Answer»		Basis of differentiation	Equity shares	Preference Shares
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