ETF Report: Virtus Diversified Income & Convertible Fund (ACV)

What this ETF is trying to do

The Virtus Diversified Income & Convertible Fund, known by its ticker symbol ACV, is an exchange-traded fund (ETF). This type of fund is designed to provide income to investors. It focuses on different types of investments, such as convertible securities, to try and generate regular payments.

What the numbers show

As of July 14, 2026, the current price of ACV is $27.75. Looking at how the fund has performed, it has seen significant growth over different periods.

For example, the one-year total return was 35.9846%. If we look even further back, the three-year total return was 87.7688%. This shows that the price and the payments combined have grown quite a bit over the last three years. The year-to-date (YTD) total return is currently 10.6027%.

To see how price changes affect money, let's use an example. Imagine you invested $10,000 into this fund one year ago when the estimated price was $22.50. If the price grew to the current $27.75, your $10,000 would have grown to about $12,333 before any extra income payments were added.

Income and distribution explanation

Some investors look for ETFs that pay them regular money, which is called a "distribution." ACV has a distribution yield of 9.1676%. This means the amount paid out relative to the price is quite high. Over the last 12 months, the fund made 13 distributions. These payments usually happen every month.

It is important to remember that a high yield alone can be misleading. A very high percentage might look good, but it does not tell you if the underlying value of the fund is staying healthy.

NAV erosion explanation

"NAV erosion" happens when an ETF's share price keeps falling because it is paying out more money than it is actually earning. If a fund's price drops 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 the price collapses, you might get high payments, but your total account value could shrink significantly.

Fortunately, for ACV, no price erosion was detected. The data shows an erosion score that is considered "good," meaning the price has been growing rather than shrinking.

Pros

• The fund has shown strong total returns over one-year and three-year periods.

• It provides frequent income, usually on a monthly basis.

• There is no evidence of price erosion in the current data.

Cons

• High yields can sometimes hide risks that are not immediately obvious.

• Investors must watch if the price stays stable or grows to ensure they aren't losing their original investment.

Beginner takeaway

Income investors usually prefer ETFs that go sideways (stay at the same price) or move slightly up. This is because they want to collect their regular payments without seeing their original investment disappear. ACV has shown a history of price growth alongside its payments, which is different from funds that suffer from severe NAV erosion.