Preferred Stocks Vs. High Yield BondsBoth preferred stocks and high yield bonds have experienced a decline in value during the Federal Reserve's tightening cycle. However, this hesitancy has spread to preferred equity as well, with certain REIT preferreds experiencing unwarranted selloffs. I also decided to sprinkle in REIT preferreds in a new REIT ETF Index. This is how the REIT Index selects the preferred shares in the portfolio:iREIT®-MarketVector™ Quality REIT IndexAnother way to play preferreds is to consider these two "pure play" preferred ETFs, InfraCap REIT Preferred ETF (PFFR) and the iShares Preferred and Income Securities ETF (PFF). I agree with Jay and that's the reason I maintain around 10% of my REIT portfolio in preferreds and we also include the preferreds in the REIT ETF Index.

Source: Forbes August 02, 2023 14:40 UTC