Understanding the GLOBAL X DAX GERMANY ETF (DAX)

The GLOBAL X DAX GERMANY ETF (ticker: DAX) is designed to track the performance of companies in Germany. It provides investors with exposure to a group of large German businesses through a single fund.

What this ETF is trying to do

This ETF seeks to follow the movement of the German stock market. It holds a variety of companies, which helps spread risk across different industries. According to the most recent data, the fund holds 44 total companies.

Top Holdings:

• SIEMENS AG (11.42%)

• SAP SE (10.41%)

• ALLIANZ SE (9.30%)

• SIEMENS ENERGY AG ORDINARY SHARES (7.14%)

• AIRBUS SE (6.51%)

• DEUTSCHE TELEKOM AG (5.33%)

• INFINEON TECHNOLOGIES AG (4.46%)

• MUNCHENER RUCKVERSICHERUNGS-GESELLSCHAFT AG (3.62%)

• DEUTSCHE BANK AG (3.54%)

• DHL AG (3.15%)

Please note that these are only the top holdings and the list is partial. Holdings can change over time.

What the numbers show

When looking at how this ETF has performed, it is important to distinguish between price return (the change in the share price) and total return (which includes distributions).

• Year-to-Date (YTD): The price return is approximately -4.43%, while the total return is approximately -2.56%.

• One-Year: The price return was approximately -3.73%, and the total return was approximately -1.66%.

• Three-Year: The price return was approximately 61.66%, and the total return was approximately 71.84%.

• Five-Year: The five-year total return was approximately 54.83%.

An estimated price from roughly one year ago was $45.29, compared to the current price of $43.60.

Income and distribution explanation

This ETF provides cash distributions to investors. The current distribution yield is approximately 2.16%. This number represents the cash paid out relative to the ETF's price.

The distribution frequency is described as "irregular or less frequent," with 2 payouts recorded in the last 12 months. It is important to remember that a distribution yield is not the same as a total return. While distributions provide cash, they do not guarantee that your original investment will stay the same value.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the assets held by the fund). The supplied data is sufficient to evaluate price erosion, but it does not include enough historical NAV-per-share data to confirm or rule out NAV erosion.

However, we can look at the erosion-risk score, which is 94. This is labeled as "Stable / sideways" with a "good" severity level. There is no severe erosion-risk flag for this ETF.

Pros

• Strong Long-Term Returns: The three-year and five-year total returns show significant growth over those periods.

• Stable Risk Profile: The erosion-risk score suggests the price movement has been relatively stable over time.

Cons

• Recent Price Decline: Both the year-to-date and one-year price returns have been negative.

• Irregular Income: The distributions do not follow a regular, frequent schedule.

Beginner takeaway

The DAX ETF offers a way to invest in major German companies like Siemens and SAP. While it has seen some price declines recently, its long-term total returns have been positive. Investors looking for income should note that the distributions are irregular and the yield is 2.16%. Always remember to look at both price changes and total returns to see the full picture of how a fund is performing.