A perpetuity is an investment that is intended to provide an expected return indefinitely, either remaining constant or growing by an incremental amount. Preferred stock is a common example with a preestablished dividend formula.

An annuity is a stream of fixed periodic payments that is expected to be paid or received. An indefinite stream of payments cannot be compounded into a future value, but it can be discounted to a present value, providing an opportunity to determine the amount an investor should be willing to pay for a share…

perpetuity — a stream of periodic payments that is expected to continue indefinitely. preferred stock — shares of ownership in a corporation that typically entitle the holder to a fixed dividend per share, if declared by the corporation, with priority over holders of that…. annuity — a stream of regular, periodic payments to be received or paid. growing perpetuity — a stream of periodic payments that is expected to continue indefinitely with growth of the amount paid or received in the future, usually by a fixed percentage.