Preferred income potential
Preferred securities may provide regular income through dividends or coupons.
Cohen & Steers Preferred Securities
Preferred Securities
Preferred securities are hybrid credit investments where income potential, credit analysis and capital structure all matter.
Preferred securities for income investing
Preferred securities generally rank ahead of common stock but may rank below senior debt in an issuer's capital structure. Investors consider dividend or coupon income, issuer credit quality, call features, interest-rate sensitivity and liquidity.
For investors researching preferred securities and income opportunities, the category may offer a distinct source of income and higher income potential, but performance depends on credit conditions, rates and issuer fundamentals.
Hybrid credit analysis
Issuer financial strength and capital-structure position are important considerations.
Interest-rate and credit risk
Interest-rate and credit-spread changes can affect preferred securities valuations.
Preferred securities, income investing and credit risk
Preferred securities are commonly reviewed by income investing objectives, issuer credit quality and the investor's tolerance for credit risk. Because these securities sit within a company's capital structure, analysis typically considers coupon or dividend durability, call features, liquidity, credit spreads and how rate changes may affect valuations.
Related Cohen & Steers investment topics
Preferred Securities Income FAQ
What are preferred securities in a portfolio?
They are hybrid investments with characteristics of stocks and bonds and may serve as an income-oriented allocation.
Why are preferred securities used for income investing?
They may provide regular dividend or coupon income, subject to issuer and market risks.
How do preferred securities compare with bonds for yield?
Preferred securities may offer different yield potential than traditional bonds, but they also carry distinct credit, call, liquidity and capital-structure risks.
What credit and interest-rate risks affect preferred securities?
Issuer credit quality, changes in interest rates, credit spreads, call features and liquidity conditions can affect returns.
Investing involves risk, including possible loss of principal. This page is for informational purposes only.