Virtus InfraCap US Preferred Stock ETF

PFFA

Market cap $2.39B

Two weeks ago, I said that one of my favorite stocks right now is Pfizer (PFE). The pharmaceutical giant is in the middle of a transformational period with the goal to return to growth by 2029.

Registered investment advisors did not pull back on exchange-traded funds in the first quarter of 2026. They kept adding them, according to AdvizorPro's Q1 2026 Quarterly RIA ETF Trends Report.

Most major asset classes, including SPY and QQQ, are trading at expensive valuations due to the AI boom and tech dominance. Defensive yield-oriented sectors like MLPs, REITs, and infrastructure have rallied over 10% YTD amid a flight-to-safety dynamic. So, finding enticing dividends that are backed by robust fundamentals has become more difficult.

The headline number on Virtus InfraCap U.S. Preferred Stock ETF (NYSEARCA:PFFA) is a distribution yield at 9.67%, which looks generous against the unleveraged iShares Preferred and Income Securities ETF (NASDAQ:PFF) at 5.6%.

A 68-year-old retiree who wants to generate $42,000 a year in dividend income without constantly riding the swings of the S&P 500 faces a portfolio math problem that rewards precision.

At a 3.5% blended yield, replacing $75,000 requires roughly $2,142,857 in invested capital.

With money market funds and short Treasury bills hovering near 4.6%, the bar for owning anything with equity-like risk has gone up.

The Virtus InfraCap U.S. Preferred Stock ETF (NYSEARCA:PFFA) sits at $21.62 heading into the back half of 2026, paying a 9.5% yield that has drawn income investors looking for something between bond coupons and common stock dividends.

Virtus InfraCap US Preferred Stock ETF remains a 'buy' for its 9.5% yield and defensive structure amid recession concerns. PFFA's diversified preferred stock holdings limit single-issuer risk, with the top holding at just 2.47% and top 10 at 22.45%. Financial sector exposure (34.09%) is a risk in downturns, but preferreds offer seniority and more stable distributions versus common equity.

Virtus InfraCap U.S. Preferred Stock ETF maintains a Strong Buy rating for a 3-year horizon, driven by high starting yields and resilient credit conditions. The short-term outlook needs closer monitoring, though. Recent macro shifts—persistent high rates and emerging credit concerns—narrow upside, making price stability more dependent on credit holding firm. PFFA's returns remain primarily distribution-led; elevated yields cushion downside, but rate and credit variables require closer monitoring for bigger new commitments.