Preferred Stocks and Preferred Income Funds Offer High Yields

A preferred stock trades like a stock but offers income like a bond. Preferreds are attractive because their yields are usually higher than corporate bonds of similar credit ratings. And preferred dividends are taxed at a lower rate than corporate bonds. Like bonds, preferred stocks usually trade in a narrow price range, but they can experience significant prices declines.

You can find information about specific preferred stocks at QuatumOnline, a free site. Or check with your broker.

In addition to individual preferred stocks, you can invest in convenient closed-end funds and exchange-traded fund that feature preferred stocks. Here is a sample of closed-end preferred income funds with current yields updated each day.

Here are three exchange-traded funds (ETFs) with relative low annual fees that offer high yields from preferred stocks include: PowerShares Financial Preferred Portfolio (PGF), PowerShares Preferred Portfolio (PGX) and iShares S&P U.S. Preferred Stock Index (PFF). For more details about these three ETFs, see Preferred Stock ETFs Deliver High Yields.


Related Articles:

buyupside.com Guide to High-Yield Investments
Closed-End Funds
Exchange-Traded Funds
Preferred Stocks Deliver High Yields


Updated Mar-19-2010.