Understanding the FM FOCUS EQUITY ETF (FMCX)

What this ETF is trying to do

The FM FOCUS EQUITY ETF (ticker: FMCX) is an exchange-traded fund listed on the NYSE. Based on its top holdings, this fund invests in a variety of large companies across different industries. Because the list provided is partial, we can only see some of its 33 total holdings. Some of the top companies in this portfolio include Microsoft Corp, GE Aerospace, and KKR & Co Inc.

What the numbers show

When looking at an ETF, it is important to understand two different types of returns: price return and total return. Price return only tracks how much the share price has changed. Total return includes both the price change and any cash distributions (dividends) paid out to investors.

Here is how FMCX has performed:

• Year-to-Date (YTD): The price return is approximately 6.61%, while the total return is approximately 6.70%.

• One Year: The price return was approximately 4.38%, and the total return was approximately 4.70%.

• Three Years: The price return was approximately 52.12%, and the total return was approximately 57.78%.

To give you an idea of price movement, the current price is $36.72. The estimated price from roughly one year ago was approximately $35.18.

Income and distribution explanation

Some investors look for ETFs that pay out cash, known as distributions. FMCX has a distribution yield of approximately 0.29%. This means the cash paid out is small relative to the ETF's price. The fund has made two distributions in the last 12 months, and the frequency is described as irregular or less frequent.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the assets held by the fund). While a falling share price can sometimes be a sign of erosion, it is not proof of it. For FMCX, the erosion-risk score is 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag present.

Pros

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

• Stable Risk Profile: The erosion-risk measurements suggest the fund's value has been relatively stable rather than rapidly declining.

Cons

• Lower Yield: The distribution yield is quite low at 0.29%, which may not appeal to investors looking for high regular income.

• Partial Data: The list of holdings provided is only a partial view of the full portfolio.

Beginner takeaway

When studying FMCX, remember that total return is the most complete way to see how much value an investment has gained, as it includes both price increases and cash payments. While this fund has shown growth over the last three years, always remember that past performance does not guarantee what will happen in the future.