Virtus fund manager recommends that preferred stocks should be favored by Fed rate cuts

Are you looking to diversify your investment portfolio? Consider preferred stocks, which offer a middle ground between bonds and common stocks in terms of risk. One financial firm that is making waves in this space is Infrastructure Capital Advisors, led by Founder and CEO Jay Hatfield.

Hatfield manages the Virtus InfraCap U.S. Preferred Stock ETF (PFFA), which has seen impressive performance in recent years. According to CNBC’s “ETF Edge”, high yield bonds and preferred stocks tend to outperform other fixed income categories during strong market conditions. Hatfield’s ETF has delivered a 10% return in 2024 and nearly 23% over the past year.

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The top holdings of the Virtus InfraCap U.S. Preferred Stock ETF include Regions Financial, SLM Corporation, and Energy Transfer LP. These stocks have shown strong performance, with gains of around 18% or more this year. Hatfield’s investment strategy focuses on identifying mispriced assets with the potential for future growth.

While the ETF has seen a slight decline since its inception in May 2018, it remains an attractive option for investors seeking exposure to preferred stocks. With a focus on asset-intensive businesses, the Virtus InfraCap U.S. Preferred Stock ETF offers a unique opportunity to enhance your investment portfolio.

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