ETF Report: John Hancock Preferred Income Fund (HPI)

What this ETF is trying to do

The John Hancock Preferred Income Fund (HPI) is an ETF listed on the NYSE. This type of fund focuses on providing income to its investors. It does this by investing in "preferred" assets, which are often used to pay regular amounts of money to shareholders.

What the numbers show

As of July 16, 2026, the current price of HPI is $16.17. Looking at the past year, the price has grown by about 1.51%. However, when you look at the "total return," which includes the money paid out to investors, the one-year return is much higher at 11.13%.

To see how price changes affect an investment, let's use a simple example. Imagine you invested $10,000 into this ETF one year ago when the estimated price was about $15.93. If you only looked at the share price, your $10,000 would have grown slightly to about $10,150. But because this fund also pays out money, your total value would be higher once those payments are included.

Income and distribution explanation

This ETF is designed to pay out money regularly. Over the last 12 months, it paid out a total of $1.482 per share. The "distribution yield" is 9.1651%, which tells you how much income the fund pays relative to its price. This fund usually pays out monthly, and in the last year, it made 12 separate payments.

It is important to remember that a high yield alone can be misleading. A very high percentage might look good, but you must always check if the actual price of the ETF is staying steady or falling.

NAV erosion explanation

"NAV erosion" happens when an ETF's share price drops significantly over time because it is paying out more money than it is actually earning. If a fund's price collapses from a high number to a much lower number, it can destroy your "principal." Principal is the original amount of money you put in. If you invest $10,000 and the price drops by half, you only have $5,000 left, even if they pay you dividends.

For this fund, the data shows a "good" erosion score. There is no price erosion detected, meaning the share price has not been falling due to these payouts.

Pros

• The fund has a high total return over one year (11.13%) and three years (39.83%).

• It provides regular monthly income.

• The share price has shown growth rather than a steady decline.

Cons

• The year-to-date price return is slightly negative (-0.1235%), meaning the share price has dipped a little bit recently.

Beginner takeaway

Income investors usually prefer ETFs that go sideways (stay at the same price) or move slightly up. They prefer this over funds that collapse in price. This is because if the price stays steady, your original investment stays safe while you collect the income. HPI has shown a history of positive total returns, but always remember to look at both the yield and the share price together.