ETF Education Report: DIREXION DAILY  BRKB BEAR 1X SHARES (BRKD)

What this ETF is trying to do

The DIREXION DAILY  BRKB BEAR 1X SHARES (ticker: BRKD) is an "inverse" ETF. This means it is designed to move in the opposite direction of its target. While this report does not list specific holdings, an inverse ETF typically aims to provide the opposite performance of a specific stock or index.

What the numbers show

When looking at ETF data, it is important to know the difference between "price return" and "total return."

• Price Return only tracks how much the share price itself has changed.

• Total Return includes both the change in share price and any cash distributions (dividends) paid out to investors.

For BRKD, the numbers show:

• Year-to-Date (YTD): The price return is approximately 5.31%. When including distributions, the YTD total return is approximately 5.89%.

• One Year: The price return was approximately 5.18%. The one-year total return was approximately 6.29%.

To visualize the price change, we can look at an estimated price from roughly one year ago. The price was approximately $23.10, and the current price is $24.30.

Income and distribution explanation

Some investors look for ETFs that pay out cash, known as distributions. BRKD has a distribution yield of approximately 1.04%. This represents the cash distributed relative to the current ETF price. Over the last 12 months, there were two distributions. The frequency of these payments is described as irregular or less frequent.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of an ETF's underlying assets decreases significantly over time. It is important to note that a falling share price is not the same thing as NAV erosion.

For this ETF, the StockValueFinder erosion-risk score is 100, which is labeled as "No price erosion detected." There is no severe erosion-risk flag for this fund.

Pros

• The ETF has shown positive price returns and total returns over the year-to-date and one-year periods.

• The erosion-risk measurement is currently rated as "good."

Cons

• Total return data for the three-year period was not supplied.

• The distribution frequency is irregular, meaning investors cannot rely on a steady schedule of cash payments.

Beginner takeaway

When studying an ETF like BRKD, remember that price returns and total returns tell different stories. Price return only shows the movement of the share price, while total return includes the extra value from distributions. Additionally, always look at both the yield and the price movement; a high yield does not guarantee that the investment value is staying stable.