ETF Education Report: BNY Mellon Alcentra Global Credit Income 2024 Target Term Fund Inc (DCF)

What this ETF is trying to do

This ETF, trading under the ticker DCF, is an asset type known as an ETF. It focuses on providing income through global credit.

What the numbers show

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

• Price Return: This measures only how much the share price changed. For example, the one-year price return was approximately 15.50%. The year-to-date (YTD) price return was approximately 13.37%.

• Total Return: This is a different measure that includes distributions. According to the data, the one-year total return was approximately 20.76%, and the YTD total return was approximately 17.52%.

The current price is $9.24. Based on the one-year price return, the estimated price from roughly one year ago was approximately $8.00. Over a three-year period, the price return was approximately -2.01%, while the three-year total return was approximately 18.10%.

Income and distribution explanation

This ETF provides cash distributions to investors. The distribution yield is approximately 4.17%. This number describes the cash payments relative to the current share price. Over the last 12 months, there were 11 distributions, which usually happen on a monthly basis. It is important to remember that receiving regular cash income does not guarantee that your original investment (your principal) will stay the same value.

NAV erosion explanation

"NAV" stands for Net Asset Value, which is the actual value of the assets held by the fund. "NAV erosion" happens when the value of those underlying assets drops significantly over time.

StockValueFinder uses an erosion-risk score to measure this risk. This ETF has an erosion-risk score of 94, which is labeled as "Stable / sideways," and the erosion severity is described as "good." There is no severe erosion-risk flag for this fund. This suggests that the fund's value has not shown signs of a major collapse.

Pros

• The fund has shown positive total returns over the one-year and three-year periods.

• It provides regular cash distributions (usually monthly).

• The erosion-risk measurements suggest a stable profile rather than a high risk of value loss.

Cons

• The three-year price return was negative, meaning the share price itself dropped over that time.

• As with all investments, there is no guarantee of future performance or the preservation of your principal.

Beginner takeaway

When studying ETFs like DCF, always distinguish between the share price and the total return. A rising share price is good, but total return tells you how much you actually earned when including the cash distributions you received. While high yields can be attractive for income, investors often look for funds that stay stable or grow in price to help protect their initial investment.