PFF vs SPFF

PFFAiShares Preferred and Income Securities ETF

SPFFCGlobal X SuperIncome Preferred ETF

In short

PFF Preferred stock is a clumsy market to shop one issue at a time. PFF, running since 2007, bundles roughly 500 US dollar preferreds and hybrids into a single heavily traded ticker and pays out monthly.

SPFF Most preferred funds buy the whole market. SPFF shops at the top of the yield table: roughly 50 of the highest-yielding US preferreds, tracked by index rule and paid out monthly since 2012.

Stated mandate

PFF The fund seeks to track an index of U.S. dollar-denominated preferred and hybrid securities, providing exposure to preferred stock and subordinated debt with an income-oriented mandate.

SPFF The Fund seeks investment results that generally correspond to the price and yield performance of the Global X U.S. High Yield Preferred Index, before fees and expenses.

Why people hold it

• PFF One ticker buys roughly 500 US dollar preferreds and hybrids tracking the ICE Exchange-Listed Preferred & Hybrid Securities Index, a corner most investors can't assemble issue by issue.
• Distributions land monthly rather than quarterly, a steadier rhythm for anyone spending the income.
• A multi-billion-dollar fund that trades actively, so getting in and out is rarely the hard part.
• Live since 2007, through the financial crisis and several rate cycles, with the same income-oriented mandate from a large index shop.

• SPFF Income density is the design: the index ranks US preferred securities by yield and holds about 50 from the top, rather than spreading thin across the entire preferred market.globalxetfs.com
• Pays monthly, and has done so since the 2012 launch. That is a long, unbroken cadence for an income sleeve.globalxetfs.com
• Preferred payouts can be treated as qualified dividend income rather than ordinary interest, a tax wrinkle most bond funds cannot offer.globalxetfs.com
• The 0.48% fee sits near the middle of the preferred ETF pack. Not the discount aisle, not a premium either.

Worth knowing

• PFF 0.45% a year is the going rate in this niche (the peer median), but it's many times what broad stock index trackers like VT charge.
• Preferreds and subordinated debt are hybrids: they rank below an issuer's senior bonds, so this trades on credit and rate conditions more than on earnings growth.
• The mandate is US dollar issuers only, so there's no international preferred exposure here.

• SPFF About 50 positions means every name carries real weight. Broad preferred funds spread the same risk across hundreds of issues.globalxetfs.com
• Buying the highest-yielding preferreds means owning the paper the market prices most cautiously, and price swings have run hotter than the calmer end of the peer group.
• Cheaper builds exist in the same cohort (PFFV at 0.25%, EVPF at 0.20%), and SPFF's mid-size asset base and moderate volume mean spreads deserve a look on bigger orders.

Full PFF profile⁠

Full SPFF profile⁠