What this ETF is trying to do

The Delaware Enhanced Global Dividend & Income Fund (ticker: DEX) is an ETF designed to provide income through global dividends. This means the fund seeks to collect money from companies around the world and pass some of that cash along to investors.

What the numbers show

As of March 10, 2023, the current price of one share is $7.56. Looking back, the estimated price from roughly one year ago was about $8.66.

When looking at how the fund performed over the last year, we see two different numbers:

• One-year price return: -12.70%. This measures only the change in the share price.

• One-year total return: -5.25%. This includes both the share price change and the cash distributions paid out.

To understand this, imagine you invested $10,000 into this ETF about one year ago at the estimated price of $8.66. If you only looked at the share price (not including any cash payments), your $10,000 would have dropped to approximately $8,730 due to the -12.70% price return.

Over a longer period, the three-year price return was -14.67%, but the three-year total return was 8.48%. This shows that while the share price went down over three years, the total return was positive when including distributions.

Income and distribution explanation

This ETF has a distribution yield of 8.57%. This number describes the cash payments relative to the ETF's price. The fund usually pays out money monthly, and it made 12 payments over the last year.

It is very important to remember that a high distribution yield is not the same as total return. A high yield can sometimes be misleading if the share price is falling at the same time.

NAV erosion explanation

The data shows an erosion-risk score of 75, which is labeled as "mild price erosion."

"NAV erosion" refers to a decline in the actual value of the assets held inside the fund. While a falling market price is called a share-price decline, an erosion-risk score helps measure if the underlying value of the fund is also being affected. In this case, the risk is described as mild.

Pros

• Monthly Income: The fund provides regular cash payments, usually every month.

• Long-term Total Return: Over a three-year period, the total return was positive at 8.48%.

Cons

• Share-Price Decline: The share price has dropped significantly over the last year (-12.70%).

• Erosion Risk: There is a measurement of mild price erosion.

Beginner takeaway

When looking at ETFs that pay high distributions, don't just look at the yield. It is important to see if the share price is also falling. Income investors often prefer funds where the price stays steady or goes up slightly, because if the share price collapses, it can cancel out the benefits of the cash payments.