Principal's Capital Securities targets preferred securities investment

By Toni Weeks

San Luis Obispo, Calif., July 19 - Principal Funds, Inc. completed an N-1A filing with the Securities and Exchange Commission for its new preferred shares fund, Capital Securities.

The fund seeks to provide current income by investing at least 80% of its net assets, plus any borrowings for investment purposes, in preferred securities. The fund will invest more than 25% of its net assets in securities in the U.S. and non-U.S. financial services industry.

The investment team includes Fernando "Fred" Diaz, Roberto Giangregorio, L. Phillip Jacoby, IV, Manu Krishnan and Mark A. Lieb. All are employees of Spectrum Asset Management, Inc., the fund's subadviser.

The fund will launch with class S shares. The ticker symbol is "PCSFX."

There will be no shareholder fees or management fees. Des Moines-based Principal Management Corp., the investment adviser, has agreed to absorb any fees and expenses of the fund so as to keep operating expenses to zero.

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