Daily ETF Watch: Preferred Fund Debuts

Elkhorn rolled out its third ETF, a preferred stock fund.

ETF.com
|
Reviewed by: etf.com Staff
,
Edited by: etf.com Staff

Elkhorn Investments rolled out its third ETF on the Bats stock exchange today. The Elkhorn S&P High Quality Preferred ETF (EPRF) comes with an expense ratio of 0.47%.

Preferred stocks are a sort of hybrid security that combines traits from both the fixed-income and equity spaces. For example, they pay a dividend based on a percentage of their par value and they give shareholders priority over common-stock owners in cases of distributions or liquidation.

The largest preferred stock ETF currently trading is the $15.5 billion iShares U.S. Preferred Stock ETF (PFF | B), which also charges an expense ratio of 0.47%. But while PFF can invest in preferred stocks without regard for credit rating, EPRF is limited to the investment-grade space—thus the “High Quality” portion of its name.

Components of EPRF’s index must also be U.S.-listed and pay a fixed-rate dividend, not a variable rate. Further, eligible securities need to have outstanding market capitalizations of at least $100 million and have traded at least 250,000 shares each month for the preceding six months.

Bats Global Markets is the owner of ETF.com.

Contact Heather Bell at [email protected].

etf.com is the single source for ETF intelligence. We provide real-time ETF news and analysis to educate investors and drive financial knowledge in the space. Our personalized and accurate information, alongside industry-leading financial tools, are depended upon to develop winning investment and financial decisions. At etf.com, we strive to serve both the individual investor as well as the professional financial advisor to educate and grow the ETF community.