ETF Evaluator: Principal Spectrum Preferred and Inc ETF () Follow This ETF

Principal Spectrum Preferred and Inc ETF Overview

Principal Spectrum Preferred and Inc ETF (PQDI) is an actively managed Taxable Bond Preferred Stock exchange-traded fund (ETF). Principal Funds launched the ETF in 2020.

The investment seeks to provide current income. Under normal circumstances, the fund invests at least 80% of its net assets, plus any borrowings for investment purposes, in preferred securities and other income-producing securities. The fund also invests in other income-producing securities that include securities that have a stated coupon rate which expects to pay interest or dividends. The fund invests in income-producing securities, including but not limited to contingent convertible securities (“Cocos”) and other types of capital securities.

About Principal Spectrum Preferred and Inc ETF (PQDI)

There are 7 members of the management team with an average tenure of 5.97 years: Manu Krishnan (2020), Roberto Giangregorio (2020), Kevin Nugent (2020), Fernando Diaz (2020), Satomi Yarnell (2021), Mark Lieb (2020) and L. Phillip Jacoby (2020). Management tenure is more important for actively managed ETFs than passive index ETFs.

The ETF has 2 primary benchmarks: ICE BofA 7%Cst DRD EligPref Sec TR USD index with a weighting of 100% and Bloomberg Global Aggregate TR USD index with a weighting of 100%. Principal Spectrum Preferred and Inc ETF has 104 securities in its portfolio. The top 10 holdings constitute 27.0% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a diversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.

Principal Spectrum Preferred and Inc ETF is part of the Hybrid Securities global asset class and is within the Taxable Bond ETF group. Principal Spectrum Preferred and Inc ETF has 49.3% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 0.0% There is 0.0% allocated to foreign stock, and 50.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 49.3% (0.0% domestic bond, 49.3% foreign bond and 0.0% convertible bond). Principal Spectrum Preferred and Inc ETF has 0.7% of the portfolio in cash.

Assets Under Management

The fund has $70 million in total assets, which is below the $1 billion average for the Preferred Stock category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

PQDI Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Principal Spectrum Preferred and Inc ETF expense ratio is above average compared to funds in the Preferred Stock category. Principal Spectrum Preferred and Inc ETF has an expense ratio of 0.60%, which is 3% higher than its category average, making the fund expense ratio grade a D. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Principal Spectrum Preferred and Inc ETF has a portfolio turnover rate of 17%, which indicates that it holds its assets around / 0.1 years. By way of comparison, the average portfolio turnover is 38% for the Preferred Stock category.

Recently, in the month of July 2026, Principal Spectrum Preferred and Inc ETF returned -0.6%, which earned it a grade of F, as the Preferred Stock category had an average return of -0.0%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.

Principal Spectrum Preferred and Inc ETF has a trailing yield of 5.61%, which is below the 6.18% category average. The fund normally distributes its income monthly.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Principal Spectrum Preferred and Inc ETF Grades

Year to date, the ETF has returned 1.2%, 0.1 percentage points worse than the category, which translates into a grade of D. The fund has returned 5.2% over the past year (grade of B), 8.2% over the past three years (grade of B) and 3.1% per year over the past five years (grade of A).

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