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ETRACS 2xMonthly Pay Leveraged Preferred Stock Index ETN (PFFL)
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Upturn Advisory Summary
01/21/2025: PFFL (1-star) is currently NOT-A-BUY. Pass it for now.
Analysis of Past Performance
Type ETF | Historic Profit -11.2% | Avg. Invested days 49 | Today’s Advisory PASS |
Upturn Star Rating | Upturn Advisory Performance 2.0 | ETF Returns Performance 1.0 |
Profits based on simulation | Last Close 01/21/2025 |
Key Highlights
Volume (30-day avg) 4450 | Beta 39.41 | 52 Weeks Range 8.32 - 11.12 | Updated Date 01/22/2025 |
52 Weeks Range 8.32 - 11.12 | Updated Date 01/22/2025 |
AI Summary
ETF ETRACS 2xMonthly Pay Leveraged Preferred Stock Index ETN (PEPLU) Overview
Profile
Target Sector: Preferred Stocks Asset Allocation: Focuses on preferred stocks offering monthly distributions. Investment Strategy: Utilizes a leverage strategy to amplify the returns of the underlying index (up to 2x) and offers monthly dividend distributions.
Objective
- Track the performance of the Solactive 2xLeveraged Preferred Stock Index (SPSIU) with a goal of achieving double the daily performance of the index.
- Provide monthly dividends to investors.
Issuer
- Issuer: UBS AG
- Reputation and Reliability: UBS AG is a reputable global financial services firm with a strong track record in the ETF industry.
- Management: The ETF is managed by UBS Asset Management, which has a dedicated team of professionals overseeing its investment strategies.
Market Share
- Market Share: PEPLU has a relatively small market share within the preferred stock ETF space.
Total Net Assets
- As of November 11, 2023, PEPLU has total net assets of approximately $9.7 million.
Moat
- Leveraged Exposure: The 2x leverage strategy can amplify returns, potentially outperforming non-leveraged preferred stock ETFs.
- Monthly Distributions: Provides regular income for investors seeking consistent cash flow.
- Access to Preferred Stocks: Offers exposure to a diversified portfolio of preferred stocks, which can provide stability and income.
Financial Performance
- Historical Performance: PEPLU has experienced high volatility given its leverage strategy. Performance data is available on financial websites like Yahoo Finance or Bloomberg.
- Benchmark Comparison: PEPLU has generally outperformed the S&P 500 index due to its focus on preferred stocks.
Growth Trajectory
- The preferred stock market is projected for moderate growth. Investors interested in this ETF should research current market trends and forecasts.
Liquidity
- Average Trading Volume: PEPLU has a relatively low average trading volume, making it less liquid than larger ETFs.
- Bid-Ask Spread: The bid-ask spread is typically wider than more actively traded ETFs.
Market Dynamics
- Economic Indicators: Interest rate changes and economic growth can significantly impact preferred stock performance.
- Sector Growth Prospects: The growth potential of the preferred stock market can influence the ETF's performance.
- Market Conditions: Overall market volatility can affect the ETF's price and liquidity.
Competitors
- Key Competitors: PFX (ETRACS 2xMonthly Leveraged Preferred Stock Index ETN), PSK (SPDR S&P 500 Preferred Stock ETF), PFF (iShares Preferred Stock ETF)
- Market Share Percentages: PFF (largest), PSK, PFX, PEPLU (smallest)
Expense Ratio
- The total expense ratio for PEPLU is 0.95%.
Investment Approach and Strategy
- Strategy: Aims to track the S&P Enhanced Preferred Stock Index, providing exposure to US preferred stocks with large and mid-sized market capitalization.
- Composition: Holds a diversified portfolio of preferred stocks from various industries.
Key Points
- Offers leveraged exposure to preferred stocks.
- Provides monthly dividend distributions.
- Has a higher expense ratio than some competitors.
- Exhibits higher volatility due to leverage.
Risks
- Volatility: PEPLU experiences high volatility due to its leveraged strategy.
- Market Risk: The underlying preferred stock market can be affected by various factors such as interest rate changes and economic conditions.
- Counterparty Risk: The ETF relies on the issuer to meet its financial obligations.
Who Should Consider Investing
- Investors seeking high potential returns and regular income.
- Investors comfortable with high volatility and market risk.
- Investors looking for exposure to the preferred stock market.
Fundamental Rating Based on AI
Rating: 7 out of 10
Justification: PEPLU offers a unique leveraged strategy and monthly income but carries higher volatility and market risk. Its smaller market share and expense ratio compared to larger competitors might be a drawback for some investors.
Resources and Disclaimers
- Data on PEPLU can be found on websites like Yahoo Finance, Bloomberg, and the UBS website.
- This information is for educational purposes only and should not be considered investment advice. Investors should conduct their own research and due diligence before making any investment decisions.
Disclaimer: I am an AI chatbot and cannot provide financial advice. Please consult with a professional financial advisor before making any investment decisions.
About ETRACS 2xMonthly Pay Leveraged Preferred Stock Index ETN
Exchange NYSE ARCA | Headquaters - | ||
IPO Launch date - | CEO - | ||
Sector - | Industry - | Full time employees - | Website |
Full time employees - | Website |
The index is designed to track the price movements of an equally weighted portfolio of two exchange-traded funds ("ETFs") that hold preferred securities of various issuers. The Securities are two times leveraged with respect to the index and, as a result, will benefit from two times any beneficial, but will be exposed to two times any adverse, compounded monthly performance of the index.
Note: This website is maintained by Upturn Corporation, which is an investment adviser registered with the U.S. Securities and Exchange Commission. Such registration does not imply a certain level of skill or training. Investing in securities has risks. Past performance is no guarantee of future returns. No assurance is provided as to any particular investment return, and you may lose money using our services. You are strongly advised to consult appropriate counsel before making any investments in companies you learn about through our services. You should obtain appropriate legal, tax, investment, accounting, and other advice that takes into account your investment portfolio and overall financial situation. You are solely responsible for conducting due diligence on a potential investment. We do not affect trades for you. You will select your own broker through which to transact. Investments are not FDIC insured, they are not guaranteed, and they may lose value. Please see the Privacy Policy, Terms of Use, and Disclosure for more information.