ETF Education Report: Goldman Sachs Ultra Short Municipal Income ETF (GUMI)

What this ETF is trying to do

The Goldman Sachs Ultra Short Municipal Income ETF (GUMI) is an exchange-traded fund. While the specific investment strategy is not detailed in the provided data, the name suggests it focuses on "ultra short" municipal income. This usually means the fund deals with debt from local governments that is intended to be paid back in a very short amount of time.

What the numbers show

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

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

• Total Return: This includes both the change in share price and any cash distributions (dividends) paid out to investors.

For GUMI, the share price has seen a slight decline. The estimated price from roughly one year ago was approximately $50.18, and the current price is $50.06. This results in a one-year price return of approximately -0.24%. The year-to-date (YTD) price return is also slightly negative at approximately -0.43%.

However, when you look at the total return, the numbers are positive. The one-year total return is approximately 2.40%, and the YTD total return is approximately 1.54%. This shows that the cash paid out to investors helped make up for the small drop in the share price.

Income and distribution explanation

This ETF provides cash to investors through distributions. The distribution yield is approximately 2.63%. This means the amount of cash paid out is about 2.63% of the current share price. These payments happen frequently; in the last 12 months, there were 12 distributions, which usually occur on a monthly basis. Most of these payments have been made on Mondays.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases over time. It is important to note that a falling share price does not always mean the NAV is eroding.

StockValueFinder uses an "erosion-risk score" to measure this risk. GUMI has an erosion score of 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag present.

Pros

• The ETF has a positive total return, meaning the combination of price changes and distributions has resulted in growth over the last year.

• The erosion-risk score suggests the fund's value is currently considered stable or sideways.

Cons

• The share price itself has experienced a slight decline over the last year and year-to-date.

• The income rating grade is a "C."

Beginner takeaway

For new investors, GUMI shows how total return can be different from price return. Even though the share price went down slightly, the cash distributions helped the overall total return stay positive. Always remember that a high distribution yield is not the same as total return, and it is helpful to look at both when studying an ETF.