Global X Adds New U.S. Preferred Stock ETF
July 17th 2012 at 1:30pm by Tom Lydon
Expanding on its preferred stock exchange traded fund line up, Global X is launching another fund that tracks preferred shares but will focus on the U.S. markets.
On July 17, the Global X SuperIncome Preferred ETF (NYSEArca: SPFF) will begin trading. SPFF will try to reflect the performance of the S&P Enhanced Yield North American Preferred Stock Index, which follows the highest yielding preferred securities in the U.S. and Canada. SPFF has an expense ratio of 0.58%.
The ETF has 47 holdings, and the top holdings include Credit Suisse 5.3%, American International 3.9%, Aegon NV 3.7%, Wells Fargo Capital 3.6% and Prudential Financial 3.5%.
Sub-sector allocations include financials 74%, insurance 8.4%, real estate 6.1%, energy 4.3%, industrials 2.7%, basic materials 2.4% and telecom 2.1%.
Preferred stocks have a higher claim on assets and earnings than common stocks and dividends are paid to preferred shares before common stocks. However, preferred shareholders do not have voting rights and have a lower potential for capital appreciation. [ETF Chart of the Day: Preferred Shares]
Global X also offers a preferred stock ETF that provides exposure to Canadian preferred shares: Global X Canada Preferred ETF (NYSEArca: CNPF), which has a 3.91% yield.
Other preferred stock ETFs include:
- iShares S&P US Preferred Stock Index (NYSEArca: PFF): 5.89% yield.
- PowerShares Preferred Portfolio (NYSEArca: PGX): 6.44% yield.
- PowerShares Financial Preferred Portfolio (NYSEArca: PGF): 6.72% yield.
- SPDR Wells Fargo Preferred Stock ETF (NYSEArca: PSK): 6.3% yield.
- iShares &P International Preferred Stock Index Fund (NYSEArca: IPFF): 30-day SEC yield 3.25%.
For more information on new fund launches, visit our new ETFs category.
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.