Forget Individual REITs: $14.2 Billion ETF Offers 6.4% Monthly Dividends With Lower Risk

• PFF holds $14.2B successful preferred stocks and pays a 6.4% output monthly with a 0.45% disbursal ratio.

• Monthly distributions ranged from $0.16 to $0.18 per stock successful 2025.

• SPHY offers a 6.8% output done high-yield firm bonds with a 0.05% disbursal ratio.

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iShares Preferred and Income Securities ETF (NYSEARCA:PFF) offers investors a 6.4% output by investing successful U.S. preferred stocks and income-producing securities. With $14.2 cardinal successful assets and an 18-year way grounds since 2007, PFF provides monthly income done a diversified portfolio of preferred securities issued chiefly by fiscal institutions and REITs. The money charges a 0.45% disbursal ratio and maintains nary leverage.

This infographic examines the iShares Preferred & Income Securities ETF (PFF), detailing its 6.4% output from preferred stocks, monthly income, and cardinal risks. It besides presents an alternate high-yield enslaved ETF, SPHY.

Preferred stocks inhabit a mediate crushed betwixt bonds and communal equity. They wage fixed dividends similar bonds but commercialized connected banal exchanges and tin admit oregon diminution successful value. PFF generates its output by collecting these fixed dividend payments from its holdings and distributing them monthly to shareholders. However, these distributions fluctuate based connected the portfolio's creation and the outgo schedules of underlying securities.

PFF's monthly distributions person ranged from $0.16 to $0.18 per stock passim 2025, totaling astir $2.06 annually. This variability is mean for preferred banal ETFs, arsenic antithetic holdings wage connected antithetic schedules and rates set implicit time. The money has maintained accordant monthly payments since inception, though amounts fluctuate 4th to quarter.

The superior hazard to PFF's dividend sustainability is involvement complaint sensitivity. Preferred stocks behave likewise to bonds—when involvement rates rise, their prices typically fall, and vice versa. The Federal Reserve's monetary argumentation straight impacts preferred banal valuations and the attractiveness of caller issuances versus existing holdings. Additionally, if underlying issuers look fiscal stress, they whitethorn suspend preferred dividends, reducing PFF's income.

PFF's full instrumentality past shows the value of considering some output and terms movement. While the 6.4% output provides dependable income, the fund's terms has traded successful a choky scope recently, moving conscionable $0.005 connected December 10 wrong a 14-cent regular range. This stableness contrasts sharply with idiosyncratic high-yield securities, which tin acquisition important volatility.