ETF Education Report: Eaton Vance Tax-Managed Global Buy-Write Opportunities Fund (ETW)

What this ETF is trying to do

ETW is an Exchange Traded Fund (ETF) traded on the NYSE. While the specific investment strategy details are not listed in the provided data, ETFs like this one generally aim to provide investors with specific types of market exposure or income.

What the numbers show

When looking at an ETF, it is important to understand the difference between "price return" and "total return."

• Price Return only tracks how much the share price itself has changed.

• Total Return includes both the change in share price and the money paid out through distributions.

For ETW, the numbers show a difference between these two:

• Year-to-Date (YTD): The price return is approximately 3.47%, while the total return is higher at approximately 10.24%.

• One Year: The price return is approximately 5.88%, while the total return is approximately 15.32%.

• Three Years: The price return is approximately 24.22%, while the total return is approximately 63.13%.

Based on an estimated price from roughly one year ago of $9.01, the current price is $9.54.

Income and distribution explanation

This ETF provides regular cash payments, known as distributions. The distribution yield is approximately 8.35%. This means the amount of cash paid out is about 8.35% relative to the ETF's price. These payments usually happen monthly, with 12 payments recorded over the last year.

It is important to remember that a high distribution yield does not mean you earned that same percentage as your total return. You must look at the "total return" figure to see how much you actually gained including those payments.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases over time. Some investors worry that high payouts might come at the expense of the fund's value.

For ETW, the erosion-risk score is 100, and the label states "No price erosion detected." The erosion severity is rated as "good," and there is no severe erosion-risk flag present.

Pros

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

• The total return is significantly higher than the price return, showing the impact of distributions.

• It has a high income rating grade of A+.

Cons

• The provided data does not list any Top Holdings, so the specific companies owned by the fund are unknown.

• The total number of holdings is listed as 0 in the current data provided.

Beginner takeaway

When looking at ETW, notice that the total return is much higher than the price return. This happens because the fund pays out regular distributions. While the distribution yield is high, always check the total return to see the full picture of how the investment has performed.