Reach your investment-grade income goals with preferred and capital securities.

We have seen massive monetary and fiscal stimulus from central banks and governments. Given this backdrop, preferred and junior subordinated capital securities offer unique value given their income characteristics and attractive spreads to treasuries.

We expect investors to continue to search for yield and consequently go down the capital structure in strong companies by buying preferred and capital securities.

Consider Preferred and Capital Securities

  • A conservative, risk managed approach to subordinated fixed income and CoCos with attractive yields1

  • Broadly diversified with more than 200 securities worldwide

  • High quality portfolio: 80% investment grade at security level, 100% investment grade at issuer's senior debt level

  • Managed by Spectrum Asset Management which has a long track record of managing preferred and capital securities since 1987

  • CoCo exposure limited to 30%

Quarterly update: Audio commentary

A quick update from Matthew Byer, Chief Operating Officer, Spectrum Asset Management.

An overview of our Preferred and Capital Securities strategy

In these short videos, Matt Byer, Chief Operating Officer at Spectrum Asset Management gives a brief overview of preferred and capital securities, including where value and yield come from and why now.

About Spectrum

Spectrum Asset Management is a world-leading manager of preferred and capital securities. Founded in 1987, Spectrum has over 30 years of experience in managing preferred and capital securities across varied market conditions including periods of rising and falling interest rates, improving and declining credit cycles, and global regulatory change.

Spectrum has a historical track record of consistent performance achieved by implementing its fundamental credit-based investment philosophy, leveraging its expertise in capital structure analysis, and employing and retaining its experienced team of investment professionals. Their global perspective, deep knowledge, and extensive experience uniquely position the firm to assist investors seeking the income, total return, and diversification potential offered by a professionally managed portfolio of preferred securities.

Citation

1 CoCos represent contingent convertible bonds.
Disclosure

The information on this website has been derived from sources believed to be accurate as of October 2022. Information derived from sources other than Principal Global Investors or its affiliates is believed to be reliable; however we do not independently verify or guarantee its accuracy or validity.

Subject to any contrary provisions of applicable law, no company in the Principal Financial Group nor any of their employees or directors gives any warranty of reliability or accuracy nor accepts any responsibility arising in any other way (including by reason of negligence) for errors or omissions in this document.

The information on this website contains general information only on investment matters and should not be considered as a comprehensive statement on any matter and should not be relied upon as such nor should it be construed as specific investment advice, an opinion or recommendation. The general information it contains does not take account of any investor's investment objectives, particular needs or financial situation, nor should it be relied upon in any way as a forecast or guarantee of future events regarding a particular investment or the markets in general.

This website is issued in:

  • Europe by Principal Global Investors (EU) Limited, Sobo Works, Windmill Lane, Dublin D02 K156, Ireland. Principal Global Investors (EU) Limited is regulated by the Central Bank of Ireland. In Europe, this website is directed exclusively at Professional Clients and Eligible Counterparties and should not be relied upon by Retail Clients (all as defined by the MiFID). The contents of the website have been approved by the relevant entity. Clients that do not directly contract with Principal Global Investors (Europe) Limited (“PGIE”) or Principal Global Investors (EU) Limited (“PGI EU”) will not benefit from the protections offered by the rules and regulations of the Financial Conduct Authority or the Central Bank of Ireland, including those enacted under MiFID II. Further, where clients do contract with PGIE or PGI EU, PGIE or PGI EU may delegate management authority to affiliates that are not authorized and regulated within Europe and in any such case, the client may not benefit from all protections offered by the rules and regulations of the Financial Conduct Authority, or the Central Bank of Ireland.
  • United Kingdom by Principal Global Investors (Europe) Limited, Level 1, 1 Wood Street, London, EC2V 7 JB, registered in England, No. 03819986, which is authorised and regulated by the Financial Conduct Authority (“FCA”).
  • Switzerland by Principal Global Investors (Switzerland) GmbH.
  • United Arab Emirates by Principal Global Investors LLC, a branch registered in the Dubai International Financial Centre and authorized by the Dubai Financial Services Authority as a representative office and is delivered on an individual basis to the recipient and should not be passed on or otherwise distributed by the recipient to any other person or organisation.

Spectrum Asset Management, Inc. is an affiliate of Principal Global Investors.

2445078-122023