ETF Education Report: Calamos Convertible Opportunities and Income Fund (CHI)

What this ETF is trying to do

The Calamos Convertible Opportunities and Income Fund (CHI) is an ETF traded on the NASDAQ. While the specific investment strategy is not detailed in the provided data, ETFs like this generally aim to provide a mix of growth and income for investors.

What the numbers show

When looking at an ETF, it is important to understand two different types of returns: price return and total return.

• Price Return: This measures only the change in the share price. For CHI, the one-year price return was approximately 9.95%. The year-to-date (YTD) price return was approximately 14.98%.

• Total Return: This is a more complete measure because it includes both the share price changes and the cash distributions paid out to investors. For CHI, the one-year total return was approximately 21.14%, and the YTD total return was approximately 22.32%.

To see how the price has moved, we can look at an estimated price from roughly one year ago. The estimated price was $11.00, and the current price is $12.05. Over three years, the total return was approximately 52.25%.

Income and distribution explanation

This ETF focuses on providing regular cash to investors. The distribution yield is approximately 9.46%. This number tells you how much cash was distributed relative to the current ETF price.

The fund usually pays out money monthly, and it has made 12 distributions over the last year. These trailing distributions totaled $1.14 per share. It is important to remember that a high distribution yield does not mean the investor earned that exact percentage as their total return; you must look at the "total return" figure to see the full picture.

NAV erosion explanation

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

Pros

• The fund shows a positive total return across one-year, three-year, and five-year periods.

• It provides a high distribution yield for those looking for regular cash income.

Cons

• The data provided does not list any specific Top Holdings, so the exact companies inside the fund are unknown from this report.

Beginner takeaway

When evaluating an ETF like CHI, don't just look at the distribution yield. A high yield can be helpful for income, but you should always check the total return to see how much the investment actually grew after including those payments. Also, checking the erosion-risk score can help you understand if the fund's value is staying stable.