FXED vs PFFD

FXEDFSound Enhanced Fixed Income ETF

PFFDAGlobal X U.S. Preferred ETF

In short

FXED An actively managed income portfolio parked in an aisle of index preferred trackers. Sound's managers hand-pick corporate bonds, high yield, BDCs and REITs instead of following a benchmark, pay monthly, and charge 1.89% a year for the work.

PFFD Preferred stock is a corner where fund fees usually run rich. PFFD turned up in 2017 charging 0.23% for a broad basket of U.S. preferreds, and it has paid monthly ever since. Cheap, plain-vanilla exposure to an income niche.

Stated mandate

FXED The Fund seeks current income while also offering the possibility of capital appreciation.

PFFD PFFD seeks to track the performance of the ICE BofA Diversified Core U.S. Preferred Securities Index before fees and expenses. It provides broad exposure to U.S. preferred stocks.

Why people hold it

• FXED Go-anywhere income mandate: investment grade and high yield corporate bonds, BDCs, REITs and sovereign debt ETFs, not one index sleeve of bank preferreds.soundincomestrategies.comsec.gov
• Income comes first by design: the stated objective is current income, with capital appreciation only a possibility, and the fund pays monthly.
• Run since its 2020 launch by Sound Income Strategies, an RIA built around income portfolios, with security picking done by humans rather than an index rulebook.soundincomestrategies.comsec.gov

• PFFD Charges 0.23% a year, which Global X notes is less than half the average fee among competing preferred funds.globalxetfs.com
• Holds roughly 220 U.S. preferreds tracking the ICE BofA Diversified Core index. Benchmark-like exposure, not a manager's shortlist.globalxetfs.com
• Pays distributions monthly, and has done so every year since its 2017 launch.globalxetfs.com
• A multi-billion-dollar fund that trades actively, so entering and exiting is rarely the hard part.

Worth knowing

• FXED Cost is the headline trade-off: 1.89% a year, above the category median, against index peers like PFFD at 0.23% and PFF at 0.45%. Active calls have to clear that hurdle.
• A small, thinly traded fund, so spreads can be wide and larger orders may move the price.
• No index to check it against: results ride on the manager's security selection, and our review places it toward the back of its preferred-income peer group.sec.gov

• PFFD Preferreds come mostly from banks and insurers, and the index has been concentrated in banking, so the ride tracks financial-sector health.globalxetfs.com
• These securities behave more like long bonds than stocks: interest rate moves push prices around, as the fund's risk disclosures describe.globalxetfs.com
• Monthly does not mean fixed. The payout size floats with what the portfolio collects.globalxetfs.com

Full FXED profile⁠

Full PFFD profile⁠