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Important Notes:

  1. Manulife Global Fund – Preferred Securities Income Fund ("Manulife Preferred Securities Income Fund" or the "Fund") invests primarily in preferred securities listed or traded on any regulated market in the world, including preferred stocks (including convertible preferred stocks) and subordinated debt securities, which exposes investors to fixed income and equity market risk, volatility and liquidity risk and currency risk. As the Fund may carry significant exposure to US-related issuers it may expose investors to geographical concentration risk.
  2. The relevant distributing class of the Fund does not guarantee distribution of dividends, the frequency of distribution and the amount/rate of dividends. Dividends may be paid out of income, realised capital gains and/or out of capital of the Fund in respect of Inc share class(es). Dividends may be paid out of realised capital gains, capital and/or gross income while charging all or part of their fees and expenses to capital (i.e. payment of fees and expenses out of capital) in respect of MDIST (G) and R MDIST (G) share class(es). Dividends paid out of capital of the Fund amounts to a return or withdrawal of part of the amount of an investor's original investment or from any capital gains attributable to that original investment and may result in an immediate decrease in the net asset value per share in respect of such class(es) of the Fund.
  3. The Fund's investment in fixed income and cash and cash equivalents is subject to credit risk, interest rate risk, credit rating and downgrading risk and high-yield bonds risk.
  4. The Fund intends to use financial derivative instruments (“FDIs”) for investment, efficient portfolio management and/or hedging purposes.  The use of FDIs exposes the Fund to additional risks, including volatility risk, management risk, market risk, credit risk and liquidity risk.
  5. Investment involves risk. The Fund may expose its investors to capital loss. Investors should not make decisions based on this material alone and should read the offering document for details, including the risk factors, charges and features of the Fund and its share classes.
  6. Given RMB is currently not a freely convertible currency, payment of redemptions and/or dividend payment in RMB may be delayed due to the exchange controls and restrictions applicable to RMB. As offshore RMB (CNH) will be used for the valuation of RMB denominated Class(es), CNH rate may be at a premium or discount to the exchange rate for onshore RMB (CNY) and there may be significant bid and offer spreads and thus the value of the RMB denominated Class(es) will be subject to fluctuation. Any devaluation of RMB could adversely affect the value of investors' investments in the RMB denominated Class(es) of the Fund.
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What are Preferred Securities?

Issued by corporates, preferred securities rank between traditional bonds and common stocks in the capital structure of a corporate. In the event of corporate financial distress or a bankruptcy, a company's preferred securities are senior to common stock but subordinated to traditional bond.

The preferred securities issuers are usually large and highly regulated institutions and/or companies with stable cash flows such as banks, utilities, and real-estate investment trusts (REITs).

The average credit rating of preferred securities is BBB-, an investment grade (IG) rating.

Priority of dividends and claims


Examples of issuers1


Banks, insurance companies and financial services
Bank of America Corporation, HSBC Holdings, Morgan Stanley, MetLife Inc.


Dominion Energy Inc., DTE Energy Company, NextEra Energy Capital Holdings Inc.


Vodafone Group Inc., Ford Motor Company, Brunswick Corporation


Preferred securities' rating2


Major advantages of Preferred Securities

Inflation-hedging potential with compelling yields

With an average investment-grade rating, preferred securities now offer around 7.8% yield, the highest level in the past decade. Thanks to the higher credit spread, during the period of higher inflation over past 20 years3, preferred securities generally held up well with positive returns above US IG corporate bonds and US treasuries.


Yield of preferred securities rose to historical high levels4

Interest rate risk mitigation

Predominated by fixed-to-floating rate securities, preferred securities are less sensitive to rising interest rates (i.e. shorter duration) compared to other investment-grade bonds. Fixed-to-floating preferreds can offer coupon protection from rising rates as the variable coupon type securities can capture higher coupon when rates rise.


Duration of investment-grade fixed income assets5

Downside buffer with higher quality

Preferred securities are well positioned to help buffer economic slowdown as near 90% of preferred issuers are rated as investment grade and are generally well-established, high-quality companies with solid balance sheets. Historically, the default rate of preferred securities was much lower than global high yield bonds.


10-year average default rate (2012-2022)6

Manulife Preferred Securities Income Fund

Aims to deliver consistent income plus a balanced sector positioning

Manulife Preferred Securities Income Fund aims to offer monthly distributions with potential capital growth. Compared to broad preferred market, the Fund is more diversified positioned, with focus on utilities, energy and financials sectors, which are better-positioned in a high inflation and low growth environment.

The Fund adopts dynamic strategies to respond to the changing macroeconomic environment by flexibly allocating into various types of preferred securities, e.g., institutional/retail, fixed-to-floating/fixed and convertible/nonconvertible. The Fund also actively manages portfolio duration in accordance with the interest rate cycle.


Dividend schedule

(The distribution yield is not guaranteed. Distribution may be paid out of capital. Refer to Important Note 2.)


For illustrative purposes only and does not represent the actual investment.

Manulife Investment Management's expertise

30+ years

investment experience by US based lead manager



global fixed income investment experts8


USD 4.8 billion

AUM in preferred securities, one of the key players in the market9


  1. For illustrative purposes only in relation to the ICE BofA US All Capital Securities Index's holding and may be subject to change. It does not constitute an offer or an invitation by or on behalf of Manulife Investment Management to any person to buy or sell any particular securities or investment. This material should not be viewed as a current or past recommendation or a solicitation of an offer to buy or sell any investment product or adopt any investment strategy. As of June 30, 2023.
  2. Source: Manulife Investment Management, Bloomberg, as of 30 June 2022. Preferred securities are represented by ICE BofA US All Capital Securities Index (I0CS). Due to rounding, the total may not be equal to 100%. Credit ratings are provided by either S&P, Moody’s or Fitch, which is higher. *B or below includes non-rated securities / issuers.
  3. Higher inflation refers to US CPI > 2% during 2002 to 2022, excluding GFC during Sep 2007 to Nov 2009.
  4. Source: Bloomberg, as of June 30, 2023. Preferred securities are represented by ICE BofA US All Capital Securities Index. The above yield to maturity does not represent the distribution yield of the Fund and is not an accurate reflection the actual return that an investor will receive in all cases. A positive distribution yield does not imply a positive return. For illustrative purposes only. Past performance is not indicative of future performance.
  5. Source: Bloomberg, as of June 30, 2023. Preferred securities are represented by ICE BofA US All Capital Securities Index; US treasuries are represented by ICE BofA US Treasury & Agency Index; US IG Corp bonds are represented by ICE BofA US Corporate Index; EM USD bonds represented by ICE BofA Emerging Market External Sovereign Index. For illustrative purposes only. Past performance is not indicative of future performance. Due to rounding, the total may not be equal to 100%.
  6. Source: Global high yield bonds are represented by ICE BofA Global High Yield Index; Global IG corporate bonds represented by ICE BofA Global Corporate Bond Index; Preferred securities are represented by ICE BofA US All Capital Securities Index. Default rates for global high yield bonds and global IG corporate bonds sourced from Moody’s, as of December 31, 2022. Preferred default rates for preferred securities were calculated by Manulife Investment Management based on ICE BofA US All Capital Securities Index, as of December 31, 2022. Calculated annually. Past performance is not indicative of future performance.
  7. Source: Manulife Investment Management, as of December 1, 2022, refers only to Class AA (USD) MDIST(G). Annualized yield = [(1+distribution per unit/ex-dividend NAV)^ distribution frequency per annum]–1, the annualized dividend yield is calculated on the basis of the latest relevant dividend distribution and dividend reinvested, and may be higher or lower than the actual annual dividend yield. Please note that dividend is not guaranteed, and a positive dividend yield does not imply a positive return. Dividend yield increases sharply due to the significant drop in NAV. Please refer to for the historical distribution yield records. Past performance is not indicative of future performance.
  8. Source: Manulife Investment Management, as of March 31, 2023. Manulife Investment Management’s global investment professional team includes expertise from several Manulife IM affiliates and joint ventures; not all entities represent all asset classes.
  9. Source: Manulife Investment Management, data as of March 31, 2023.