One Of The Best 9%+ Yields I've Ever Seen For Retirees: PFFA
At a time when the market trades near all-time highs and macro uncertainty soars, it can be scary for retirees looking to invest to fund their golden years. Virtus InfraCap U.S. Preferred Stock ETF offers retirees a near 10% yield with monthly distributions and a track record of dividend growth. I share why PFFA offers retirees one of the best near 10% yields I have ever seen.
PFFA: No Opinions, Just Data
The Virtus InfraCap U.S. Preferred Stock ETF offers a high current yield by investing in a diversified portfolio of preferred and hybrid securities. PFFA's portfolio is heavily weighted toward lower-quality issuers, with an average B+ credit rating and significant exposure to financials and speculative companies. The fund's attractive ~8% yield is offset by higher credit event risk, aggressive active management, and the use of leverage, increasing volatility.
PFFA: The Active Preferred ETF Edge
Preferred stock ETFs are often passively managed. But the preferred securities market presents a unique mix of structural quirks that can quickly expose the shortcomings of index-based investing. Instead of buying the entire market, PFFA screens out negative yield-to-call positions, tactically adjusts its fixed-versus-floating rate exposure, and diversifies beyond financials. PFFA generally employs between 20% and 30% leverage to enhance its ability to generate income, and deploys active income strategies across a diversified basket of high-yielding preferred stocks.
PFFA: A Preferred Strategy Amid Recession Concerns
Virtus InfraCap U.S. Preferred Stock ETF offers high income and diversification through U.S. preferred securities, with a current yield of 9.47%. PFFA outperforms the S&P U.S. Preferred Stock Index but slightly underperforms the S&P 500, especially during recent market rallies driven by AI speculation. The ETF's diversification across sectors, including financials, real estate, and utilities, helps mitigate risk, especially in uncertain economic times.
PFFA: 9% Yield That Income Investors Should Not Ignore
PFFA has recently performed very well, despite the interest rate cuts and its exposure to floating preferreds (including negative yield-to-call risk). The yield has dropped to 9%, which raises the question of whether the yield is too low relative to the theoretically unfavorable environment. In the article, I share multiple reasons why this is not the case.
My Retirement Portfolio Yields 9%, Boosted By PFFA
Grab some Kleenex for the tears of joy you'll be shedding. This fund puts the FUN in fund and in your retirement. Don't miss out on income or capital gains today.
Preferred Stocks With Room To Run
I built a preferred stock portfolio starting in 2022 in anticipation of falling inflation and interest rates, which has delivered strong double-digit returns. With fiscal and monetary policy now more aligned, I expect inflation to return to the Fed's 2% target and falling interest rates creating further upside for preferred stocks and ETFs. Preferred stocks RITM.PR.D, ABR.PR.F, CIM.PR.C, and ETFs PFFA, PFFR, and PFXF should benefit from declining rates over the next year.
PFFA: Bullish, Despite Its Inherent Risks
Virtus InfraCap U.S. Preferred Stock ETF's leveraged, high-yield strategy will naturally table risks. Despite the fund's risk appetite, key metrics suggest that returns have eclipsed PFFA's risk exposure. PFFA ETF's total returns and distribution profiles convey soundness.
Hard To Imagine Retirement Income Without These 2 Cash Machines
Achieving financial independence through income-only investing is challenging, especially with no asset sales and the need for inflation protection. Yet, this strategy reduces longevity risk, enables generational wealth transfer, and lessens stress from market volatility. The best approach is to target high-quality, high-yield value stocks with stable dividends and reasonable valuations, avoiding value traps.
PFFA: Not All Preferred ETFs Are Built Alike
One underappreciated benefit of preferreds is how well they can fit inside an exchange-traded fund. PFFA prioritizes yield and total return, using an actively managed strategy tailored to the complexities of the preferred space. Over numerous time horizons, PFFA has consistently outpaced the S&P U.S. Preferred Stock Index and its Morningstar peer category average.
Collect Massive Preferred Stock Income For Your Retirement: PFFA
Are you a fated pair with this fund? Maybe! But the income it provides is generous. No need for backroom deals or blood oaths, you can buy this income on the stock market easily. Discover the love of income, and you'll be rolling in dividends.
As We Get Older And Stop Making Cents
A penny for your thoughts? Oh, no! We don't make 'em anymore! As you age, you make fewer cents, and need more dollars to live. Your retirement needs cash flow; how do you plan to generate it?
