Share-split context: A minor share adjustment was recorded on Jun 17, 2021 with coefficient 1.012. Current price-return figures are already normalized to the current share basis.

ETF Education Report: BlackRock Science and Technology Trust (BST)

What this ETF is trying to do

The BlackRock Science and Technology Trust (BST) is an ETF listed on the NYSE. While the specific holdings are not listed in this report, the name suggests it focuses on companies involved in science and technology.

What the numbers show

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

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

• Total return includes both the price changes and the cash distributions (dividends) paid out to investors.

For BST, the total returns have been higher than the price returns:

• Year-to-Date (YTD): The price return is approximately 25.41%, while the total return is approximately 38.39%.

• One Year: The price return is approximately 20.82%, while the total return is approximately 39.84%.

• Three Years: The price return is approximately 56.82%, while the total return is approximately 114.25%.

This ETF has a history of forward splits. In a forward split, each old share becomes multiple new shares, and the price per share falls proportionally. This does not change how much of the fund you own; it just changes the number of shares you hold.

Income and distribution explanation

BST provides regular cash distributions. The distribution yield is approximately 12.80%. This means the amount of cash paid out is quite high relative to the current share price of $50.84. These distributions usually happen monthly, with 12 payments recorded over the last year.

It is important to remember that a high distribution yield does not mean you earned that percentage as your total return. You must look at the "total return" numbers to see how the investment performed overall.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases over time. Some investors worry that high payouts might cause this. However, for BST, the erosion-risk score is 100, and the label states "No price erosion detected." There is no severe erosion-risk flag for this ETF.

Pros

• The fund has shown significant total returns over the last one, three, and five years.

• It provides a high distribution yield with monthly frequency.

• The erosion-risk measurements currently look good.

Cons

• Top holdings data was not supplied in this report.

• High distribution yields can sometimes be misleading if the share price is not stable (though that is not indicated by current erosion scores here).

Beginner takeaway

BST is an ETF that focuses on technology. It offers both share-price growth and regular monthly cash payments. When studying this ETF, always distinguish between the price return (the change in share cost) and the total return (the change in value including the cash paid to you).