AIPI: REX AI EQUITY PREMIUM INCOME ETF
ETF Education Report: REX AI EQUITY PREMIUM INCOME ETF (AIPI)
What this ETF is trying to do
The REX AI EQUITY PREMIUM INCOME ETF (AIPI) is an exchange-traded fund that focuses on generating income. It is classified as an "option income" ETF. This means it uses specific financial strategies involving options to try and create cash for its investors.
What the numbers show
When looking at an ETF, it is important to separate the share price from the total return.
• Price Return: This measures only how much the share price has changed. For AIPI, the one-year price return was approximately -11.66%. The year-to-date (YTD) price return was approximately -5.72%.
• Total Return: This includes both the share price changes and the cash distributions paid out. Even though the share price went down over the last year, the one-year total return was approximately 24.04%. The YTD total return was approximately 21.21%.
To visualize the price change, the estimated price from roughly one year ago was $42.74. The current price is $37.76.
Income and distribution explanation
This ETF is known for high distributions. The distribution yield is approximately 34.27%. This number describes the cash paid out relative to the ETF's price. These payments happen frequently; in the last 12 months, there were 27 distributions, which usually occur on a monthly basis. Most of these payments have been made on Wednesdays.
It is important to remember that a high distribution yield does not mean the investor earned that same percentage as a total return. You must look at the "total return" figure to see the full picture of how the investment performed.
NAV erosion explanation
"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases. While a falling share price does not always mean the NAV is dropping, we use an "erosion-risk score" to measure this risk.
AIPI has an erosion score of 75, which is labeled as "mild price erosion." This indicates a mild level of risk regarding the stability of the fund's value.
Top Holdings
The following are some of the top holdings in this ETF (note that this is a partial list):
• PLTR: 10.83%
• NVIDIA CORP: 9.69%
• CROWDSTRIKE HOLDINGS INC CLASS A: 9.25%
• ARM HOLDINGS PLC ADR: 4.12%
• DATADOG INC CLASS A: 3.75%
Pros
• The ETF has provided a high one-year total return of approximately 24.04%.
• It offers a high distribution yield for investors seeking regular cash flow.
Cons
• The share price has experienced a decline over the last year.
• There is a "mild" erosion-risk score.
Beginner takeaway
High yields can be exciting, but they can also be misleading. An investor should look at both the price return (the cost of the shares) and the total return (the price change plus the cash received). In the case of AIPI, while the share price fell, the total return remained positive due to the large distributions.
Top Holdings
Structured portfolio holdings supplied by the ETF data provider. These figures are not generated by the AI article.
| # | Holding | Ticker | Weight |
|---|---|---|---|
| 1 | n/a | PLTR | 10.83% |
| 2 | NVIDIA CORP | NVDA | 9.69% |
| 3 | CROWDSTRIKE HOLDINGS INC CLASS A | CRWD | 9.25% |
| 4 | ARM HOLDINGS PLC ADR | ARM | 4.12% |
| 5 | DATADOG INC CLASS A | DDOG | 3.75% |
| 6 | SYNOPSYS INC | SNPS | 3.64% |
| 7 | ALPHABET INC CLASS A | GOOGL | 3.38% |
| 8 | CISCO SYSTEMS INC | CSCO | 3.36% |
| 9 | ADOBE INC | ADBE | 3.28% |
| 10 | SALESFORCE INC | CRM | 3.27% |