PGX Profile
The Invesco Preferred ETF is a strategic investment fund focused on U.S. dollar-denominated preferred securities. It aims to achieve its investment objective by investing a substantial portion of its assets, typically at least 80%, in securities that are components of its underlying index. The ETF’s investment approach is closely aligned with the performance of the ICE Data Indices, LLC's preferred securities index, ensuring a targeted exposure to the market of fixed-rate preferred securities.
ICE Data Indices, LLC, the index provider, utilizes a rigorous selection process to determine the components of the underlying index. This index is market capitalization-weighted, meaning that the securities are weighted according to their total market value, which reflects both their price and the number of outstanding shares. The index is designed to capture the total return performance of the U.S. dollar-denominated preferred securities market, providing investors with a benchmark for evaluating the performance of preferred securities.
Preferred securities, also known as preferred stocks, are hybrid financial instruments that combine features of both equity and debt. They typically offer fixed dividend payments and have a higher claim on assets than common stocks in the event of liquidation, but lower priority than bonds. The Invesco Preferred ETF focuses on these securities to provide investors with income generation and potential capital appreciation, while also offering a measure of stability compared to more volatile equity investments.
By tracking the performance of the ICE Data Indices' preferred securities index, the ETF provides investors with broad exposure to the preferred securities market. This exposure can be particularly beneficial for those seeking to diversify their investment portfolios and achieve income through fixed dividends. The fund's strategy is designed to offer a balance between income and stability, catering to investors looking for yield while managing risk in a structured manner.
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