Preferred stocks should benefit from fed rate cuts, according to Virtus money manager.
One financial firm aims to profit from preferred stocks, which offer higher returns than bonds but are less risky than common stocks.
Jay Hatfield, Founder and CEO of Infrastructure Capital Advisors, oversees the management of the company's investments and business development.
When the stock market is strong and we're exiting a tightening cycle, high yield bonds and preferred stocks typically outperform other fixed income categories, as stated by the expert on CNBC's "ETF Edge" this week.
In 2024, Hatfield's ETF experienced a 10% increase, while over the past year, it saw an almost 23% growth.
According to FactSet, his ETF's top three holdings as of Sept. 30 are , , and , with all three stocks experiencing an increase of approximately 18% or more this year.
Hatfield's team believes that many of the top holdings are undervalued based on their risk and potential return, he stated.
The Virtus InfraCap U.S. Preferred Stock ETF has experienced a nearly 9% decline since its launch in May 2018.
Markets
You might also like
- Banco BPM to be Acquired by UniCredit for $10.5 Billion
- Can Saudi Arabia sustain its rapid spending on ambitious mega-projects?
- The cost of Russian food is increasing, yet nobody is accusing Putin or the conflict of the rise.
- In Laos, six travelers are believed to have died from methanol poisoning. This is where such incidents are most common.
- Precious metal investors are being distracted by the allure of the crypto rally, according to State Street.