ZPR The Globe and Mail reports in its Wednesday edition that when you start constructing a portfolio that will generate cash, preferred shares may be worth a look. The Globe's David Berman writes that they beckon with yields north of 5 per cent, which is significantly better than current yields on government bonds and guaranteed investment certificates (GICs). And when held in a taxable account, the distributions from preferred shares receive favourable treatment from the government. Preferred shares are fixed-income investments that straddle the world of stocks and bonds. Like stocks, they trade on exchanges throughout the day, at fluctuating prices. Similar to bonds, they're issued at a "par" starting price and don't reward investors with a share of the profits. Mr. Berman has bought preferreds from Power Corp. of Canada, Brookfield Property Partners and Fortis. He focuses on shares trading at, or ideally below, par. For diversification, the columnist gives a shout-out for units in the BMO Laddered Preferred Share Index ETF. Preferred shares are boring, predictable and in for many people one of the coolest things to own in retirement, and despite rising prices, investors can still score shares that trade below par.