ETF Education Report: Apollo Senior Floating Rate Fund Inc (AFT)

What this ETF is trying to do

Apollo Senior Floating Rate Fund Inc (AFT) is an exchange-traded fund (ETF) traded on the NYSE. While the specific investment strategy is not detailed in the provided data, it is categorized as an ETF asset type.

What the numbers show

It is important to understand the difference between price return and total return. Price return only tracks how much the share price changes. Total return includes both price changes and the money paid out through distributions.

According to the data as of July 22, 2024:

• Year-to-Date (YTD): The YTD price return is approximately 12.15%. However, the YTD total return is higher at 20.77%.

• One-Year: The one-year price return is approximately 15.73%. The one-year total return is approximately 31.01%. We can estimate the price from roughly one year ago was $12.84.

• Three-Year: The three-year price return is approximately -2.88%. Despite the share-price decline, the three-year total return is 30.43%.

Income and distribution explanation

This ETF has a distribution yield of approximately 11.70%. This number describes the cash distributions relative to the current ETF price. The fund usually pays out distributions monthly, with 12 payments recorded over the last year.

It is important to remember that a high distribution yield is not the same as total return. While these distributions provide cash income, they do not guarantee that your original investment (your principal) will stay the same value.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases. StockValueFinder uses an erosion-risk score to measure this risk.

For AFT, the erosion-risk score is 94, which is labeled as "Stable / sideways." The erosion severity is described as "good," and there is no severe erosion-risk flag present. This suggests that, based on these specific measurements, the fund is not currently showing signs of high erosion risk.

Pros

• The fund has provided a positive one-year total return of approximately 31.01%.

• It offers a high distribution yield of approximately 11.70%.

• The erosion-risk measurements are currently rated as "good."

Cons

• The three-year price return is negative, meaning the share price has declined over that period.

• High distribution yields can sometimes be misleading if the share price is also falling.

Beginner takeaway

When looking at an ETF like AFT, always look at both the price return and the total return. The price return tells you how the share price moved, while the total return shows the full picture including cash payments. Because this fund has a high distribution yield, it is important to monitor whether the share price stays stable or declines over time.