Against the backdrop of rising rates, higher inflation, and elevated volatility, balancing the search for yield and risk mitigation is no easy task. But one asset class that many overlook is preferred securities. Preferreds blend characteristics of stocks and bonds and can offer investors a way to diversify their broader portfolio while pursuing an underused potential source of attractive yield.
In the upcoming webcast, Balancing Yield and Risk with Preferred Securities, Joseph Bozoyan, portfolio manager, Manulife Investment Management; and Rick Baker, managing director of the client portfolio management team, Manulife Investment Management, will discuss the potential benefits of preferreds.
Specifically, investors can take a look at the actively managed John Hancock Preferred Income ETF (JHPI). The ETF is sub-advised by Manulife Investment Management (US) LLC, John Hancock Investment Management’s affiliated asset manager.
JHPI is an actively managed ETF that seeks to provide a high level of current income, consistent with the preservation of capital, by investing at least 80% of its net assets in preferred stocks and other preferred securities. The manager focuses on sector allocation, industry allocation, and security selection in making investment decisions and looks to invest in securities that may be undervalued relative to similar securities in the marketplace.
The John Hancock Preferred Income ETF seeks a high level of current income, consistent with the preservation of capital. The strategy also offers help with diversifying sources of income. The active managers will target a portfolio of preferred securities that can generate high income and preservation of capital.
The ETF’s portfolio will focus on preferred securities that include, but are not limited to, convertible preferred securities, corporate hybrid securities, trust preferred securities, cumulative and noncumulative preferred stock, and depositary of preferred stock.
Financial advisors who are interested in learning more about preferred securities can register for the Thursday, April 28 webcast here.