If a client wants to generate income without increasing bonds in their portfolio, what is the best investment recommendation?

Preferred stock is an excellent investment recommendation for a client seeking to generate income without increasing the number of bonds in their portfolio. Preferred stock typically pays fixed dividends, similar to bond interest payments, providing investors with regular income. This option allows the client to diversify their income sources beyond bonds while still maintaining a focus on income generation.

Preferred stocks often have characteristics that make them attractive to income-seeking investors, such as their priority over common stocks when it comes to dividend payments and liquidation in case of a company's bankruptcy. This gives preferred stock a certain level of stability and income predictability, making it an appealing choice.

In contrast, while other options may seem relevant, they do not offer the same combination of fixed income and equity participation as preferred stocks. GNMA represents government-backed mortgage securities, which are bonds and would increase the client's bond allocation. ETFs, depending on their focus, may also include a variety of securities that could add unwanted volatility to income generation strategies. Income bonds, while they offer potential for some income, are typically more speculative and do not guarantee payment, making them less reliable for consistent income generation.