PTA - FPF: May Be Best To Pare Back Your Position Today (Rating Downgrade)
2024-02-23 06:56:54 ET
Summary
- The First Trust Intermediate Duration Preferred & Income Fund offers a high yield of 9.57%, higher than many other preferred stock funds.
- The fund has outperformed major fixed-income indices and even the S&P 500 Index, which is impressive for a fixed-income fund.
- Investors should be cautious as the fund's recent gains may not be sustainable due to uncertainty around interest rate cuts and potential market correction.
- The fund failed to cover its distribution during its most recent full-year period, representing the second year in a row of destructive ROC.
- The fund's shares are currently trading at a discount, but it might be a good idea to take some of your recent gains.
The First Trust Intermediate Duration Preferred & Income Fund ( FPF ) is a closed-end fund that income-focused investors can employ in pursuit of their goals. The fund does a reasonably good job at the provision of income as its 9.57% yield is higher than many other preferred stock funds. This is especially true when we compare it to the Flaherty & Crumrine preferred stock funds:
| Fund |
| Current Distribution Yield |
| First Trust Intermediate Duration Preferred & Income Fund |
| 9.57% |
| Flaherty & Crumrine Preferred Income Fund ( PFD ) |
| 6.52% |
| Flaherty & Crumrine Preferred Income Opportunity Fund ( PFO ) |
| 6.55% |
| John Hancock Preferred Income Fund ( HPI ) |
| 9.28% |
| Cohen & Steers Tax-Advantaged Preferred Securities & Income Fund ( PTA ) |
| 8.48% |