What this ETF is trying to do

The FIRST TRUST MANAGED FUTURES STRATEGY FUND (ticker: FMF) is an exchange-traded fund (ETF) that trades on the NYSE. While the specific investment strategy is not detailed in the provided data, ETFs are tools used by investors to gain exposure to different types of assets.

What the numbers show

The current price of FMF is $52.63. An estimated price from roughly one year ago was approximately $49.22.

When looking at how this ETF has performed, it is important to understand two different measurements: price return and total return. Price return only tracks how much the share price itself changed. Total return is a more complete measure because it includes both the change in share price and any cash distributions (payments) made to investors.

Here is what the data shows:

• Year-to-date (YTD): The price return is 11.86%, while the total return is 13.30%.

• One year: The price return was 6.92%, and the total return was 12.55%.

• Three years: The price return was 10.06%, and the total return was 24.65%.

Income and distribution explanation

This ETF provides cash distributions to investors. The distribution yield is 4.72%, which describes the cash payments relative to the ETF's price. Over the last 12 months, there were 4 payouts, and these typically happen on a quarterly basis (every three months).

It is important to remember that a high distribution yield does not mean an investor earned that exact percentage as their total return. Total return is the most accurate way to see how much value was actually gained or lost.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund drops significantly. For FMF, the erosion-risk score is 100, which means "No price erosion detected." The severity of this risk is labeled as "good."

Top Holdings

The provided data lists one top holding:

• MORGAN STANLEY INSTL LQUDTY TRS INSTL: 15.32% weight.

Please keep in mind that holdings can change over time.

Pros

• The ETF has shown positive price returns and total returns over the last year and three years.

• The erosion-risk score indicates no price erosion was detected.

Cons

• Only one top holding was provided in the current data set.

Beginner takeaway

FMF has shown growth in both its share price and its total return over the last three years. It also pays out regular cash distributions, but investors should always look at the total return to see the full picture of how the fund is performing.