 In effect, the holders of capital shares are borrowing money from the holders of the preferred shares at the dividend rate of the preferred shares, and investing that money in a greater number of shares in the underlying basket of shares.Capital gains (or losses) are amplified in the capital shares because the value of the preferred shares is held relatively constant, and the resulting increased volatility of the equity in the underlying basket of shares is borne mostly by the capital shares.Holders of the capital shares take on their obligation to guarantee dividend payments to the holders of the preferred shares in exchange for amplified returns.