Preferred Securities Fund (Prospectus Summary) | Preferred Securities Fund

Preferred Securities Fund

Objective:

The Fund seeks to provide current income.

Fees and Expenses of the Fund

This table describes the fees and expenses that you may pay if you buy and hold
shares of the Fund.

Shareholder Fees (fees paid directly from your investment)

Shareholder Fees	Preferred Securities Fund Class J
Maximum Deferred Sales Charge (Load) (as a percentage of dollars subject to charge)	1.00%

Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment)

Annual Fund Operating Expenses		Preferred Securities Fund Class J
Management Fees		0.71%
Distribution and/or Service (12b-1) Fees		0.45%
Other Expenses	[1]	0.34%
Total Annual Fund Operating Expenses		1.50%
Fee Waiver	[2]	0.20%
Total Annual Fund Operating Expenses After Fee Waiver		1.30%

Example

This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds.
  
The Example assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
Example also assumes that your investment has a 5% return each year and that the
Fund's operating expenses remain the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:

Expense Example (USD $)	Expense Example, With Redemption, 1 Year	Expense Example, With Redemption, 3 Years	Expense Example, With Redemption, 5 Years	Expense Example, With Redemption, 10 Years
Preferred Securities Fund Class J	232	454	800	1,773

You would pay the following expenses if you did not redeem your shares:

Expense Example, No Redemption (USD $)	Expense Example, No Redemption, 1 Year	Expense Example, No Redemption, 3 Years	Expense Example, No Redemption, 5 Years	Expense Example, No Redemption, 10 Years
Preferred Securities Fund Class J	132	454	800	1,773

Portfolio Turnover

The Fund pays transaction costs, such as commissions, when it buys and sells
securities (or "turns over" its portfolio). A higher portfolio turnover rate
may indicate higher transaction costs and may result in higher taxes when Fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses or in the example, affect the Fund's performance.
During the most recent fiscal year, the Fund's annualized portfolio turnover
rate was 16.8% of the average value of its portfolio.

Principal Investment Strategies

Under normal circumstances, the Fund invests at least 80% of its net assets,
plus borrowings for investment purposes, in preferred securities at the time
of purchase. Preferred securities generally pay fixed rate dividends (though
some are adjustable rate) and typically have "preference" over common stock in
the payment of dividends and the liquidation of a company's assets, but are junior
to all forms of the company's debt. Most of the securities purchased by the Fund
are preferred securities of companies rated at the time of purchase BBB- or higher
by Standard & Poor's Rating Service ("S&P") or Baa3 or higher by Moody's Investor
Service, Inc. ("Moody's") or, if unrated, of comparable quality in the opinion of
the Sub-Advisor. The Fund also invests up to 15% of its assets in high yield, below
investment grade quality debt (sometimes called "junk bonds" and rated at the time
of purchase BB+ or lower by S&P or rated Ba1 or lower by Moody's or of equivalent
quality as determined by the Sub-Advisor).
  
The Fund will concentrate its investments (invest more than 25% of its net assets)
in securities in the U.S. and non-U.S financial services (i.e., banking, insurance
and commercial finance,) industry. The Fund also regularly invests in the real estate
investment trust (i.e. REIT) and utility industries.

Principal Risks

Principal Risks The Fund may be an appropriate investment for investors who are
seeking dividends to generate income or to reinvest for growth and are willing
to accept fluctuations in the value of the investment.
  
The value of your investment in the Fund changes with the value of the Fund's
investments. Many factors affect that value, and it is possible to lose money by
investing in the Fund. An investment in the Fund is not a deposit of a bank and
is not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. The principal risks of investing in the Fund, in
alphabetical order, are:
  
Equity Securities Risk. Equity securities (common, convertible preferred stocks
and other securities whose values are tied to the price of stocks, such as rights,
warrants and convertible debt securities) could decline in value if the issuer's
financial condition declines or in response to overall market and economic conditions.
A fund's principal market segment(s), such as large cap, mid cap or small cap stocks,
or growth or value stocks, may underperform other market segments or the equity
markets as a whole. Investments in smaller companies and mid-size companies may
involve greater risk and price volatility than investments in larger, more mature
companies.
  
Fixed-Income Securities Risk. Fixed-income securities are subject to interest
rate risk and credit quality risk. The market value of fixed-income securities
generally declines when interest rates rise, and an issuer of fixed-income
securities could default on its payment obligations.

Foreign Securities Risk. The risks of foreign securities include loss of value
as a result of: political or economic instability; nationalization, expropriation
or confiscatory taxation; changes in foreign exchange rates and foreign exchange
restrictions; settlement delays; and limited government regulation (including
less stringent reporting, accounting, and disclosure standards than are required
of U.S. companies).
  
High Yield Securities Risk. High yield fixed-income securities (commonly
referred to as "junk bonds") are subject to greater credit quality risk than
higher rated fixed-income securities and should be considered speculative.
  
Industry Concentration Risk. A fund that concentrates investments in a
particular industry or group of industries (e.g., energy, real estate,
technology, financial services) has greater exposure than other funds to
market, economic and other factors affecting that industry.
  
Portfolio Duration Risk. Portfolio duration is a measure of the expected life
of a fixed-income security and its sensitivity to changes in interest rates. The
longer a fund's average portfolio duration, the more sensitive the fund will be
to changes in interest rates.
  
Preferred Securities Risk. Preferred securities are junior subordinated
securities in a company's capital structure and therefore can be subject to
greater credit and liquidation risk. An issuer of preferred securities could
redeem the security prior to the stated maturity date and reduce the return of
the security.
  
Real Estate Investment Trusts ("REITs") Risk. A REIT could fail to qualify for
tax-free pass-through of income under the Internal Revenue Code, and fund
shareholders will indirectly bear their proportionate share of the expenses of
REITs in which the fund invests.
  
Real Estate Securities Risk. Real estate securities are subject to the risks
associated with direct ownership of real estate, including declines in value,
adverse economic conditions, increases in expenses, regulatory changes and
environmental problems.

Risk of Being an Underlying Fund. An underlying fund of a fund of funds may
experience relatively large redemptions or investments as the fund of funds
periodically reallocates or rebalances its assets. These transactions may cause
the underlying fund to sell portfolio securities to meet such redemptions, or to
invest cash from such investments, at times it would not otherwise do so, and
may as a result increase transaction costs and adversely affect underlying fund
performance.

Performance

The following information provides an indication of the risks of investing in
the Fund. The bar chart shows the investment returns of the Fund's Class J
shares for each full calendar year of operations for 10 years (or, if shorter,
the life of the Fund). These annual returns do not reflect sales charges; if
they did, returns would be lower. The table shows, for Class J shares of the
Fund and for the last one, five, and ten calendar year periods (or, if shorter,
the life of the Fund), how the Fund's average annual total returns compare to
the returns of one or more broad-based market indices. Past performance (before
and after taxes) is not necessarily an indication of how the Fund will perform
in the future. You may get updated performance information online at
www.principalfunds.com or by calling 1-800-222-5852.
  
Class J shares were first sold on December 29, 2003. The returns for the periods
prior to that date are based on the performance of the Institutional Class
shares adjusted to reflect the fees and expenses of Class J shares. The
adjustments result in performance for such periods that is no higher than the
historical performance of the Institutional Class shares. The Institutional
Class shares were first sold on May 1, 2002.
  
Performance of a blended index shows how the Fund's performance compares to
an index with similar investment objectives. Performance of the components of the
blended index are also shown. The weightings for the Preferreds Blended Index
in the Average Annual Total Returns table are 50% BofA Merrill Lynch Fixed Rate
Preferred Securities and 50% Barclays Capital U.S. Tier I Capital Securities
Index. The custom or blended index returns reflect the allocation in effect for
the time period(s) for which fund returns are disclosed. Previous weightings or
allocations of the custom or blended index are not restated.

Total Returns as of December 31 each year (Class J shares)

^[1]

Highest return for a quarter during the period of the bar     Q2 '09      38.56%
chart above:                                                           
Lowest return for a quarter during the period of the bar      Q3 '08     -21.11%
chart above:

Average Annual Total Returns For the periods ended December 31, 2011

Average Annual Total Returns Preferred Securities Fund	Average Annual Returns, Label	Average Annual Returns, 1 Year	Average Annual Returns, 5 Years	Average Annual Returns, Since Inception
Class J	Class J Return Before Taxes	0.04%	3.67%	4.41%
Class J After Taxes on Distributions	Class J Return After Taxes on Distributions	(1.80%)	1.66%	2.68%
Class J After Taxes on Distributions and Sales	Class J Return After Taxes on Distribution and Sale of Fund Shares	0.35%	2.00%	2.80%
BofA Merrill Lynch Fixed Rate Preferred Securities Index	BofA Merrill Lynch Fixed Rate Preferred Securities Index (reflects no deduction for fees, expenses, or taxes)	4.11%	(1.19%)	2.42%
Barclays Capital U.S. Tier I Capital Securities Index	Barclays Capital U.S. Tier I Capital Securities Index (reflects no deduction for fees, expenses, or taxes)	(0.53%)	1.71%	4.87%
Preferreds Blended Index	Preferreds Blended Index (reflects no deduction for fees, expenses, or taxes)	1.81%	0.01%	3.38%

After-tax returns are calculated using the historical highest individual federal
marginal income tax rates and do not reflect the impact of state and local taxes.
Actual after-tax returns depend on an investor's tax situation and may differ from
those shown. The after-tax returns shown are not relevant to investors who hold
their Fund shares through tax-deferred arrangements, such as 401(k) plans or
individual retirement accounts.

[1] Expense information has been restated to reflect current fees. Certain Other Expenses of the Fund have increased effective November 1, 2011.

[2] Effective January 1, 2012, Principal Funds Distributor, Inc. ("the Distributor") has contractually agreed to limit the Distribution Fees attributable to Class J through December 31, 2012. The limit will maintain the level of Distribution Fees not to exceed 0.25%. It is expected that the expense limit will continue through the period disclosed; however, Principal Funds, Inc. and the Distributor, the parties to the agreement, may agree to terminate the expense limit prior to the end of the period.

[1] The year-to-date return as of March 31, 2012 was 7.79% for Class J shares.