What this ETF is trying to do

The SONICSHARES GLOBAL SHIPPING ETF (ticker: BOAT) is an exchange-traded fund that focuses on the shipping industry. It holds a variety of different companies involved in global shipping. According to the data, this ETF holds 57 total assets.

Top Holdings:

• OTHER ASSETS AND LIABILITIES (5.42%)

• MITSUI O.S.K. LINES LTD (5.31%)

• KAWASAKI KISEN KAISHA LTD (5.18%)

• FRONTLINE PLC (5.13%)

• A P MOLLER MAERSK AS CLASS B (5.06%)

• SITC INTERNATIONAL HOLDINGS CO LTD (4.90%)

• HMM (4.60%)

• WALLENIUS WILHELMSEN ASA (4.29%)

• INTERNATIONAL SEAWAYS INC (4.27%)

• ORIENT OVERSEAS (INTERNATIONAL) LTD (4.26%)

Please note that this list is a partial view of the holdings and can change over time.

What the numbers show

When looking at how an ETF performs, it is important to look at two different types of returns: price return and total return. Price return only tracks how much the share price changes. Total return includes both the price change and any cash distributions paid out to investors.

• Year-to-Date (YTD): The price return is approximately 61.33%, while the total return is approximately 67.36%.

• One-Year: The price return was approximately 58.48%, and the total return was approximately 71.59%.

• Three-Year: The price return was approximately 77.46%, and the total return was approximately 137.25%.

To visualize the price change, an investor could look at the estimated price from roughly one year ago, which was $32.13, compared to the current price of $50.92.

Income and distribution explanation

This ETF provides cash distributions to investors. The current distribution yield is approximately 5.50%. This number describes the cash paid out relative to the current ETF price. The trailing distributions over the last year totaled approximately $2.80 per share. These payments usually happen on a quarterly basis.

It is important to remember that a high distribution yield is not the same as total return. While distributions provide cash income, they do not guarantee that your original investment 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 significantly. Some investors worry about this because they want to make sure their principal (the money they put in) stays stable while they collect income.

For this ETF, the erosion-risk score is 100, which is labeled as "No price erosion detected." The erosion severity is rated as "good," and there is no severe erosion-risk flag present.

Pros

• The ETF has shown significant positive price returns over the last one, three, and five years.

• It provides a regular distribution yield of approximately 5.50%.

Cons

• The ETF is tied to the shipping industry, which can be subject to market changes.

• Investors should always remember that distributions are separate from the share price movement.

Beginner takeaway

The BOAT ETF has seen strong growth in both its share price and its total return over several years. It also pays out regular cash distributions. When looking at this ETF, remember to distinguish between the price return (the change in share cost) and the total return (which includes the cash you receive).