VanEck’s PFXF ETF outperformed with a 21% 12-month return by excluding financial sector preferred securities.
The VanEck Preferred Securities ex Financials ETF (PFXF) posted a 21% return over the past 12 months and 8% year-to-date through May 7, trading near $18.70. The fund’s strategy of avoiding bank-issued preferred securities has driven performance amid regional lender concerns, offering a 30-day SEC yield between 6.59% and 6.76%.
PFXF tracks an index of non-financial preferred securities, holding 99 securities across $2.12 billion in assets. The portfolio is heavily weighted toward utility and REIT preferreds, which are more sensitive to the 10-year Treasury yield than Fed policy rates. A sustained 10-year yield above 4.50% could compress the fund’s net asset value, while REIT credit stress poses refinancing risks.
The ETF’s 0.41% expense ratio reflects its targeted exposure, contrasting with the broader preferred market, which is over 75% bank-issued.