Content and data provided by various third parties and Fidelity − Terms of Use | Help/Glossary
Research > ETFs > ETF / ETP Commentary > 

ETF Prime: Fast-Tracking SpaceX & Preferred ETFs

BY | ETF Database
05/27/2026 | 19 VIEWS
Fast-tracking mega IPOs into major indexes and the case for active preferred ETFs were both on the agenda for this week’s ETF Prime. Host Nate Geraci welcomed Rich Lee, head of program trading and execution strategy at Baird, and Douglas Baker, portfolio manager and head of preferred securities at Nuveen.Key Takeaways: Nasdaq can now add qualifying IPOs to the Nasdaq 100 in as little as 15 days. Preferreds offer tax-advantaged income and better credit quality than ratings imply. Baker flags passive preferred ETFs may carry 8-9 year durations, posing rate risk. Lee opened by explaining why index providers are adapting their rules. Companies are staying private longer, he noted, arriving at public markets with trillion-dollar valuations. That reality makes it harder for market-cap-weighted indexes to stay representative without updating how they add new listings. Nasdaq recently updated its rules to allow qualifying IPOs to enter the Nasdaq 100 in as little as 15 days. To be eligible, a company must rank in the top 40 by market cap. By comparison, a company like Tesla took five to ten years before being added to the S&P 500. Even so, Lee acknowledged the tradeoffs. Compressing the IPO and index inclusion into 15 days forces two volatile events to collide. That tight timeline complicates price discovery in ways that a longer seasoning period avoids. Lee also addressed prediction market ETFs. The U.S. Securities and Exchange Commission is soliciting public comments, which he views as a pause to resolve disclosure and structural mechanics. The central question is whether these products will hold underlying assets directly, as, for example, the SPDR Gold Shares (GLD B) does. Or whether they will behave more like oil ETFs, where monthly contract rollovers introduce structural decay over time.The Active Case for Preferred ETFsBaker then offered a primer on preferred securities. The market sits at roughly $1 trillion globally, with about $750 billion in U.S. dollar-denominated securities. Yield draws most investors in, Baker said, but the credit quality picture is frequently misunderstood. Rating agencies typically place preferreds about four notches below the same issuer’s senior debt. This reflects their lower position in the capital stack, meaning that a fund showing an average BBB rating is often backed by single-A rated issuers underneath. Duration presents another key risk, particularly in passive preferred ETFs. Some carry profiles of eight to nine years. Baker called that aggressive given sticky inflation, deficit spending, and financing demands tied to the conflict with Iran. The Nuveen Preferred and Income ETF (NPFI B-) actively manages duration in a three-to-five-year range. Baker also cited the firm’s mutual fund track record. Over 20 years, the strategy has outperformed its benchmark by more than 200 basis points annually on a gross basis. For more ETF Prime podcast episodes, visit our ETF Prime Content Hub.

More Commentary

Navigating MLP Income: Inside the Latest Quarterly Payout for AMJB
BY | ETF Database
05/27/2026 | 26 VIEWS
Fidelity’s Thorpe Talks Yield, 2026 Outlook
BY | ETF Database
05/27/2026 | 24 VIEWS
The Energy Sector: A Tactical Trading Opportunity
BY | ETF Database
05/27/2026 | 15 VIEWS
View more Commentary

Search Commentary

Enter Keyword(s)
Filter Results

Performance data shown is past performance and is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. Yield and return will vary, therefore you have a gain or loss when you sell your shares. For standard quarterly performance, go to the fund's Snapshot page by clicking on the ETF/ETP's symbol.

ETFs may trade at a premium or discount to their NAV and are subject to the market fluctuations of their underlying investments.

For iShares ETFs, Fidelity receives compensation from the ETF sponsor and/or its affiliates in connection with an exclusive long-term marketing program that includes promotion of iShares ETFs and inclusion of iShares funds in certain FBS platforms and investment programs. Please note, this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral. Additional information about the sources, amounts, and terms of compensation can be found in the ETF's prospectus and related documents. Fidelity may add or waive commissions on ETFs without prior notice. BlackRock and iShares are registered trademarks of BlackRock, Inc. and its affiliates.

FBS receives compensation from the fund's advisor or its affiliates in connection with a marketing program that includes the promotion of this security and other ETFs to customers ("Marketing Program"). The Marketing Program creates incentives for FBS to encourage the purchase of certain ETFs. Additional information about the sources, amounts, and terms of compensation is in the ETF's prospectus and related documents. Please note that this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral.

News, commentary (including "Related Symbols") and events are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.

Any data, charts and other information provided on this page are intended to help self-directed investors evaluate exchange traded products (ETPs), including, but limited to exchange traded funds (ETFs) and exchange traded notes (ETNs). Criteria and inputs entered, including the choice to make ETP comparisons, are at the sole discretion of the user and are solely for the convenience of the user. Analyst opinions, ratings and reports are provided by third-parties unaffiliated with Fidelity. All information supplied or obtained from this page is for informational purposes only and should not be considered investment advice or guidance, an offer of or a solicitation of an offer to buy or sell a particular security, or a recommendation or endorsement by Fidelity of any security or investment strategy. Fidelity does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating ETPs. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use. Determine which securities are right for you based on your investment objectives, risk tolerance, financial situation and other individual factors and re-evaluate them on a periodic basis.

Before investing in any exchange traded product, you should consider its investment objective, risks, charges and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.