What this ETF is trying to do

The Goldman Sachs MLP and Energy Renaissance Fund (ticker: GER) is an Exchange Traded Fund (ETF) that trades on the NYSE. While the specific investment strategy is not detailed in the provided data, it focuses on energy-related assets.

What the numbers show

The current price of one share is $15.67. Based on the data, the estimated price from roughly one year ago was $10.91.

It is important to understand two different types of returns:

• Price Return: This only measures how much the share price changed.

• Total Return: This includes both the share price change and any cash distributions paid out.

Over the last year, the one-year price return was 43.63%. However, the one-year total return was higher, at 52.92%. Looking at the year-to-date (YTD) numbers, the YTD price return is 22.61%, while the YTD total return is 26.96%. Over a three-year period, the three-year price return was 108.66%, and the three-year total return was 153.79%.

To see how this works, imagine you invested $10,000 roughly one year ago at the estimated price of $10.91. Based only on the share-price movement (the price return), your investment would be worth approximately $14,363. If you include the cash distributions (the total return), that same $10,000 would be worth approximately $15,292.

Income and distribution explanation

This ETF provides cash to investors through distributions. The distribution yield is 5.33%. This number describes the cash payments relative to the ETF's price. These payments usually happen every quarter, and there were four payments in the last 12 months.

It is important to remember that a high distribution yield is not the same as total return. A high yield shows how much cash is being paid out, but it does not guarantee that the share price will stay the same or go up.

NAV erosion explanation

"NAV erosion" is a term used when the value of the underlying assets in an ETF drops. When an ETF's share price falls significantly, it can result in a loss of principal (the original money you put in).

For this fund, specific erosion-risk scores were not supplied because of its split history. There is no "severe erosion-risk flag" for this ETF at this time.

Pros

• The fund has shown strong price returns and total returns over the last year and three years.

• It provides regular cash distributions, usually on a quarterly basis.

Cons

• No specific top holdings were supplied in the data, so we cannot see which companies are inside the fund.

Beginner takeaway

When looking at ETFs like GER, always look at both the price return and the total return. The price return tells you how the share price moved, while the total return shows you the full picture by including cash distributions. Also, remember that receiving cash distributions is different from seeing your investment grow in value.