Leveraged Preferred Stock ETN Debuts

Today UBS rolled out another leveraged ETN under its ETRACS brand. The ETRACS 2xMonthly Pay Leveraged Preferred Stock ETN (PFFL) offers investors twice the monthly return of the Solactive Preferred Stock ETF Index and is set to mature on Sept. 25, 2048.

PFFL comes with an expense ratio of 0.85% and lists on the NYSE Arca.

The ETN’s underlying index is a bit unusual in that it represents the performance of an equally weighted basket containing the $16.6 billion iShares U.S. Preferred Stock ETF (PFF) and the $5.3 billion Invesco Preferred ETF (PGX).

The ETRACS family of ETNs includes 33 other ETFs, at least 10 of which offer leveraged exposure to their underlying indexes that is reset on a monthly basis.

Contact Heather Bell at [email protected]