Jay Hatfield, Founder and CEO of Infrastructure Capital Advisors, is managing an ETF called Virtus InfraCap U.S. Preferred Stock ETF (PFFA) that focuses on preferred stocks. Preferred stocks are seen as carrying more risk than bonds but less risk than common stocks. Hatfield believes that high yield bonds and preferred stocks tend to perform well when the stock market is strong, especially when coming out of a tightening cycle. The ETF is up 10% in 2024 and almost 23% over the past year, with top holdings including Regions Financial, SLM Corporation, and Energy Transfer LP.
Hatfield’s team selects names for the ETF that they believe are mispriced relative to their risk and yield, focusing on asset-intensive businesses. The top holdings are carefully chosen based on this criteria. While the Virtus InfraCap U.S. Preferred Stock ETF has experienced some fluctuation since its inception in May 2018 and is currently down almost 9%, the performance in recent years has been positive. This strategy allows investors to capitalize on the potential benefits of high yield bonds and preferred stocks during times of market strength.
The focus of the Virtus InfraCap U.S. Preferred Stock ETF on asset-intensive businesses reflects a strategy of seeking out opportunities that may be undervalued. By targeting companies that are seen as mispriced relative to their risk and yield, the ETF aims to generate strong returns for investors. The success of this approach can be seen in the ETF’s performance, with a significant increase in value over the past year and a positive outlook for the future.
Preferred stocks offer a unique opportunity for investors to access higher yields compared to traditional bonds while still maintaining a level of risk that is lower than common stocks. This allows investors to potentially benefit from market conditions that may favor high yield bonds and preferred stocks. The Virtus InfraCap U.S. Preferred Stock ETF, managed by Jay Hatfield, provides a vehicle for investors to participate in this market segment and potentially achieve strong returns over time.
The Virtus InfraCap U.S. Preferred Stock ETF’s focus on selecting mispriced assets in asset-intensive businesses offers a unique investment opportunity for investors looking to capitalize on the potential benefits of preferred stocks. By carefully selecting top holdings that exhibit these characteristics, the ETF aims to deliver strong performance and generate returns for investors. The ETF’s recent performance, with significant gains in value over the past year, demonstrates the success of this strategy and the potential for continued growth in the future.
Overall, the Virtus InfraCap U.S. Preferred Stock ETF provides investors with a vehicle to access the potential benefits of preferred stocks in a market environment that is conducive to high yield bonds and preferred stocks. Managed by Jay Hatfield, the ETF’s focus on asset-intensive businesses and selecting mispriced assets has led to strong performance and positive returns for investors. With a strategy that emphasizes opportunities for growth and performance in the preferred stock market, the ETF offers investors a unique and potentially rewarding investment opportunity.
