PREF - Investment Implications Of An Expensive Preferreds Sector

• The preferreds sector has come nearly full circle with yields spiking in March and now falling back to their levels earlier in the year.
• Expensive sector valuation means that fund fees are taking a bigger chunk of underlying yields while passive investments are holding an increasing number of negative yield-to-call stocks.
• These trends suggest investors should look at ways to mitigate the impact of fees as well as rotating into actively managed funds or individual preferreds.
• We highlight a number of securities that dovetail with some of these trends such as PFFD, PREF, WFC.PL, NLY.PD, some of which we hold in our Income Portfolios.

For further details see: