PFFD Dividend Calculator
Calculate your Global X U.S. Preferred ETF dividend income with advanced preferred stock analysis
PFFD Investment Calculator
About PFFD ETF
The Global X U.S. Preferred ETF (PFFD) seeks to provide investment results that correspond generally to the price and yield performance of the ICE BofA Diversified Core U.S. Preferred Securities Index.
Key Features:
- Diversified exposure to U.S. preferred securities
- Focus on investment-grade preferred stocks
- Monthly dividend distributions
- Higher yield potential than common stocks
- Priority over common stocks in liquidation
Preferred Stock Benefits
Income Generation:
- Higher yields than common stocks
- Fixed dividend payments
- Priority in dividend payments
- Potential tax advantages
Portfolio Diversification:
- Hybrid equity/bond characteristics
- Lower volatility than common stocks
- Credit quality diversification
- Sector exposure across financials and utilities
Investment Considerations
Risks:
- Interest rate sensitivity
- Credit risk of issuers
- Call risk on callable preferreds
- Limited capital appreciation potential
- Concentration in financial sector
Tax Considerations:
- Most dividends qualify for favorable tax rates
- Potential for qualified dividend treatment
- Consider tax-loss harvesting opportunities
PFFD vs Alternatives
| Metric | PFFD | PFF | FREL |
|---|---|---|---|
| Expense Ratio | 0.23% | 0.45% | 0.10% |
| Dividend Yield | 6.85% | 6.2% | 7.8% |
| Distribution | Monthly | Monthly | Monthly |
| Focus | Diversified Core | Broad Preferred | REIT Preferred |
Frequently Asked Questions
What makes PFFD different from other preferred stock ETFs?
PFFD focuses on diversified core U.S. preferred securities with investment-grade emphasis, offering lower fees than traditional preferred ETFs while maintaining broad exposure to quality issuers across multiple sectors.
How does interest rate risk affect PFFD?
Preferred stocks are sensitive to interest rate changes. Rising rates can decrease preferred stock prices, while falling rates may increase them. PFFD's diversified approach helps manage this risk across different credit qualities and sectors.
Are PFFD dividends qualified for tax purposes?
Most PFFD dividends qualify for favorable tax treatment as qualified dividends, taxed at capital gains rates rather than ordinary income rates. However, consult a tax professional for your specific situation.
What is the credit quality of PFFD holdings?
PFFD emphasizes investment-grade preferred securities, focusing on financially strong issuers primarily in the financial and utility sectors. The fund maintains diversification across credit ratings to balance yield and risk.
How volatile is PFFD compared to bonds and stocks?
PFFD typically exhibits lower volatility than common stocks but higher volatility than high-grade bonds. Preferred stocks offer a middle ground with hybrid characteristics of both asset classes.
Can I use PFFD for income replacement in retirement?
PFFD can be part of an income strategy due to its monthly distributions and higher yield. However, consider diversifying across asset classes and maintaining some growth exposure for inflation protection.
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