John Hancock Preferred Income Fund II (NYSE: HPF) is a diversified, closed-end management investment company that seeks to provide shareholders with a high level of current income, with a secondary objective of capital preservation. The fund primarily invests in fixed-income preferred securities and related instruments, emphasizing issuers with strong credit profiles. Through a combination of fixed- and floating-rate preferred stocks, purchased across various industries, HPF aims to deliver attractive yields while managing interest-rate and credit risks.
In pursuing its investment objectives, HPF allocates assets to preferred securities issued by U.S. and non-U.S. corporations, financial institutions, real estate investment trusts and utilities. The portfolio managers focus on sectors where preferred instruments offer favorable yield spreads over comparable debt, and they employ active duration management to navigate changing interest-rate environments. The fund may also use options and other derivatives to hedge interest-rate exposure and enhance income generation.
Since its initial public offering in 2005, John Hancock Preferred Income Fund II has been managed by John Hancock Investment Management LLC, the U.S.-based asset-management arm of Manulife Financial Corporation. The fund’s dedicated team of credit analysts and portfolio managers leverages extensive research capabilities to assess issuer fundamentals, monitor market conditions and adjust sector allocations. This disciplined, research-driven approach seeks to preserve capital while maintaining a consistent level of distributions.
HPF distributes dividends on a monthly basis, drawing primarily from income generated by its portfolio securities. The fund’s closed-end structure allows managers greater flexibility in portfolio construction and the use of leverage, which may enhance returns but also increases volatility. Investors in HPF gain access to a specialized segment of the fixed-income market, supported by the deep resources and institutional expertise of John Hancock’s investment platform.
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