Tag - yield to call

Advice to the Advisors

On Paddle Board | Active Management of Preferred Stocks | Sheaff Brock Institutional Group

Elements of Active Management of a Preferred Portfolio

No question as to which side of the ongoing debate about the merits and shortcomings of active vs. passive management is exemplified in the Sheaff Brock Preferred Income portfolio—it’s run using an actively managed strategy, and there are reasons why. With the two-part goal of generating income while preserving capital, Senior Portfolio Manager JR Humphreys utilizes both institutional and retail preferred shares. So, how can advisors set about explaining to clients the distinction between active management and a passive approach? Passive [...]

Advice to the Advisors

Sheaff Brock Institutional Group | Investment portfolios | Preferred Income Portfolio | portfolio workhorse

Harnessing Twin Risks can Turn Preferreds into Portfolio Workhorses

In any income portfolio, two “bug-a-boos” are credit risk and call risk. When it comes to preferred stocks, interest-yield-hungry investors tend to over-emphasize the former, even as they devote less than due attention to the latter, observes Sheaff Brock Senior Portfolio Manager JR Humphreys. “Investors in search of solid income from their portfolios often select preferred stocks rather than Treasury securities or ETFs based on Treasury bonds. One reason behind this decision is that preferred stocks generally pay dividends of [...]

Advice to the Advisors

preferred portfolio strategy preferred stocks rising interest rates Sheaff Brock Institutional Group

Preferreds Continue in a Starring Role

In the ever increasing search for income, preferred stocks continue to play an important role for companies and investors alike, with the Standard and Poor’s Preferred Index ETF (iShares: PFF) trading at an average share volume of 2.3 million/day as of May 23, 2017. By way of quick review, preferreds are hybrid securities, blending traits of both stocks and bonds. Like common stock, preferreds represent ownership in a company, but without voting privileges; like bonds, preferreds are issued at a [...]