Investors will soon have another preferred share exchange traded funds (ETFs) to consider now that State Street Global Advisors has launched its new specialty ETF.

This week, State Street launched its latest ETF, SPDR Wells Fargo Preferred Stock ETF (NYSEArca: PSK), that invests in nonconvertible preferred stocks, according to IndexUniverse. The fund has an annual expense ratio of 0.45% and its underlying index provides exposure to 160 or more securities.

PSK will try to reflect the performance of the Wells Fargo Hybrid and Preferred Securities Aggregate Index. The new ETF includes non-convertible preferred securities that are priced at a par amount of $25, rated investment-grade and have a minimum monthly trading volume of at least 250,000 trading units in each of the last six months.

Preferred securities usually pay a fixed rate of distribution along with potential gains investors could receive from price movements. Preferred shareholders also get the benefit of preferential treatment over holders of common stock in the likelihood of bankruptcy or other legal disputes over distributions.

The new SSgA ETF will be competing against two other preferred share ETFs already on the market:

• iShares S&P U.S. Preferred Stock Index (NYSEArca: PFF): up 33% year-to-date

• PowerShares Preferred (NYSEArca: PGX): up 14.2% year-to-date

PowerShares also has a PowerShares Preferred Financial (NYSEArca: PGF) fund available, as well.

For more information on preferred share ETFs, visit our preferred stock category.

Max Chen contributed to this article.

Tags: Asset Class ETFs, PFF, PGF, PGX, Preferred Stock, PSK