Just read this.
http://money.cnn.com/2008/10/08/news...itney.fortune/
http://money.cnn.com/2008/10/08/news...itney.fortune/
Warren Buffett recently bought $3 billion in preferred stock from General Electric (GE, Fortune 500) and another $5 billion from Goldman Sachs (GS, Fortune 500).
What's the attraction? Yield, in a word. Buffett's GE and Goldman shares carry a dividend yield of 10%. While you can't get the same deal he did, the yield on the leading preferred-stock exchange-traded index fund - iShares S&P U.S. Preferred Stock (PFF) - now stands at 11.5%. Best of all, those bond-like yields are not taxed as regular income but at the much lower dividend tax rate (usually either 5% or 15%, depending on your tax bracket).
What's the attraction? Yield, in a word. Buffett's GE and Goldman shares carry a dividend yield of 10%. While you can't get the same deal he did, the yield on the leading preferred-stock exchange-traded index fund - iShares S&P U.S. Preferred Stock (PFF) - now stands at 11.5%. Best of all, those bond-like yields are not taxed as regular income but at the much lower dividend tax rate (usually either 5% or 15%, depending on your tax bracket).
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