Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTDavid BerenSun, August 2, 2026 at 5:47 PM GMT+2 5 min readQuick ReadPFFD charges half of PFF's 0.46% fee while delivering a higher 6.5% yield from a nearly identical preferred stock portfolio.PFFA amplifies its yield to 11% through leverage, but its 2.1% expense ratio is nearly ten times what passive competitors charge.Don't wait: the analyst who called NVIDIA in 2010 just revealed his top 10 AI stocks. See the full list FREE now.Preferred stock ETFs have become a common income vehicle for investors chasing yield above what investment-grade bonds can offer. Three funds dominate the category: iShares Preferred and Income Securities ETF (NASDAQ:PFF), Global X U.S. Preferred ETF (NYSEARCA:PFFD), and Virtus InfraCap U.S. Preferred Stock ETF (NYSEARCA:PFFA). Distributions across the trio currently span roughly 6% to 11%, but the gap in fees, structure, and risk is wide enough that the three funds differ enough in cost and structure to appeal to distinct buyers.MY STOCKERS / Shutterstock.comPreferred shares pay fixed dividends and sit senior to common stock in the capital structure while ranking junior to debt. That places them in a niche where the 10-year Treasury at 4.7% sets the reference rate, and preferred ETF distributions add roughly 200 to 600 basis points on top depending on structure. The category is heavily concentrated in bank and insurance issuers, since financials are the largest issuers of preferred capital.The incumbent, with $13.3 billion in net assets, is PFF, making it by far the largest preferred stock ETF and the most liquid choice for size orders. The fund tracks a broad index of U.S. dollar-denominated preferred securities, holding a diversified basket dominated by banks, insurers, utilities, and REITs.The portfolio spreads across hundreds of positions, with meaningful concentrations in JPMorgan Chase, Bank of America, Morgan Stanley, Wells Fargo, and Athene Holding preferred issues. Boeing preferred shares are the single largest position at 4%, an unusual industrial exposure in an otherwise financials-heavy portfolio.Don't wait: the analyst who called NVIDIA in 2010 just revealed his top 10 AI stocks. See the full list FREE now.Pricing is where the incumbent story weakens. PFF charges an expense ratio of 0.46% against a distribution yield near 5.5%. Monthly distributions recently ran around $0.14 per share, and shares trade near $30. The fund returned roughly 3% on price over the past year, meaning almost the entire investor return arrives through the coupon.Scale and liquidity are real advantages for institutional users, but retail buyers pay more in fees for a portfolio that a cheaper competitor tracks almost identically.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info