ETF Report: PROSHARES EQUITIES FOR RISING RATES ETF (EQRR)

What this ETF is trying to do

The EQRR ETF is a type of fund that trades on the NASDAQ exchange. Based on its name, this fund is designed to respond to environments where interest rates are going up.

What the numbers show

Looking at the recent data, this ETF has seen significant growth. The current price is $81.1568. If we look back one year, the estimated price was about $59.72.

To understand how much money a person could have made, let's use an example. Imagine you put $10,000 into this ETF one year ago. Before any extra payments were added, that $10,000 would have grown to roughly $13,588 based on the one-year price return of 35.8864%.

The total returns (which include both price changes and extra payments) are even higher:

• Year-to-Date Total Return: 26.8298%

• One-Year Total Return: 37.6481%

• Three-Year Total Return: 71.1883%

Income and distribution explanation

Some investors look for "distributions," which are regular payments made by the ETF. This fund has a distribution yield of 1.0884%. Over the last 12 months, it made four payments, usually on Wednesdays. The total amount paid out per share over the last year was $0.8833.

It is important to remember that high yield alone can be misleading. A high percentage might look good, but you must always look at whether the actual price of the ETF is staying healthy.

NAV erosion explanation

"NAV erosion" happens when the value of the underlying assets in an ETF drops consistently, causing the share price to fall over time. If an ETF has severe erosion, it means the price is collapsing. When a share price falls from a high number to a much lower number, it can destroy your principal (the original money you put in).

Income investors usually prefer ETFs that go sideways or move slightly up. This is because they want their regular payments to come from profits, not from the fund shrinking itself just to make a payment. Fortunately, for EQRR, no price erosion was detected.

Pros

• The ETF has shown strong total returns over the last one, two, and three years.

• There is no evidence of price erosion at this time.

Cons

• The distribution yield (1.0884%) is relatively low compared to some other types of income-focused funds.

Beginner takeaway

EQRR has shown strong price growth recently. While it provides some regular payments, its main movement comes from its price changing. Always remember to look at the total return, not just the yield, to see how an ETF is actually performing.