With investors hungry for yield-generating options, the exchange traded fund industry is quickly firing off new products for the income-minded.
On Tuesday, four new ETFs hit the market, and all of them offered some kind of focus toward high income.
The First Trust Preferred Securities and Income (NYSEArca: FPE) is an actively managed fund that holds preferred stocks and corporate, high-yield and convertible bonds. Preferred shares are senior to common stocks in dividend payments but subordinate to bond holders. [First Trust Lists Active ETF for Income]
“This ETF is poised for steady, but slow to moderate growth and should be included in the fixed-income portion of your portfolio,” Ronald Lang, principal at Atlas Wealth Management, said in an Investor’s Business Daily article. “FPE will be very attractive to longer-term investors along with a healthy anticipated yield of 5.5%-6%. If this ETF is well managed, it appears that First Trust has added a potential gem to their already high-quality roster of ETFs.”
The Market Vectors BDC Income ETF (NYSEArca: BIZD) tracks business development companies that help provide capital to privately held firms that are not rated or below investment grade and thinly traded public companies. BDCs can generate robust yields. [Market Vectors Adds Specialized Income ETF]