CVRD: MADISON COVERED CALL ETF
MADISON COVERED CALL ETF (CVRD)
The MADISON COVERED CALL ETF (ticker CVRD) is designed to generate income by writing covered call options on a diversified portfolio of stocks. This strategy aims to provide regular cash distributions while aiming for modest capital appreciation.
What the Numbers Show
• Current Price: $18.22
• Estimated 1-Year Ago Price: $18.71 (reconstructed price from roughly one year ago)
• Year-to-Date Price Return: -1.15% (share-price decline only)
• Year-to-Date Total Return: +3.94% (includes distributions)
The ETF's share price has slightly declined over the past year, but its total return is positive due to cash distributions.
Income and Distribution Explanation
Distribution Yield: 7.71%
• The fund pays out quarterly dividends.
• Over the last year, it paid $1.41 per share in distributions.
The high distribution yield means that for every dollar invested, you receive about 7.7 cents annually as income from the ETF.
NAV Erosion Explanation
Erosion Score: 94 (Stable/Sideways)
• Price Return Over One Year: -2.63%
• Total Return Over One Year: +5.19%
The erosion score suggests that while there has been a slight share-price decline, the overall performance is stable when considering distributions.
Pros
• Regular Income: The ETF provides consistent quarterly payouts.
• High Distribution Yield: Attractive for income-focused investors looking to generate cash flow from their investments.
• Stable Performance: Despite some price declines, total returns have been positive over various periods.
Cons
• Price Decline: While the share price has fallen slightly in recent months, this does not necessarily mean a loss of principal value since distributions contribute positively to overall returns.
• Erosion Risk: The erosion score indicates stable performance but doesn't rule out potential risks that could affect future stability.
Beginner Takeaway
The MADISON COVERED CALL ETF (CVRD) is an income-focused investment designed to generate regular cash flows through covered call options. It has a high distribution yield, making it attractive for investors seeking steady income. However, while the share price has shown some decline recently, total returns have remained positive due to distributions. Always consider both price and total return when evaluating performance.
Remember, this ETF is not a recommendation but an educational overview based on current data.
Top Holdings
Structured portfolio holdings supplied by the ETF data provider. These figures are not generated by the AI article.
| # | Holding | Ticker | Weight |
|---|---|---|---|
| 1 | US BANK MMDA USBGFS 9 | n/a | 11.90% |
| 2 | DANAHER CORP | DHR | 5.16% |
| 3 | AMAZON.COM INC | AMZN | 4.60% |
| 4 | VISA INC CLASS A | V | 4.19% |
| 5 | BROADCOM INC | AVGO | 3.75% |
| 6 | META PLATFORMS INC CLASS A | META | 3.68% |
| 7 | BLACKROCK INC | BLK | 3.59% |
| 8 | ADOBE INC | ADBE | 3.48% |
| 9 | ACCENTURE PLC CLASS A | ACN | 3.41% |
| 10 | TRANSOCEAN LTD | RIG | 3.41% |