Understanding the LEVERAGE SHARES 2X LONG HOOD DAILY ETF (HOOG)

What this ETF is trying to do

The HOOG ETF is a leveraged fund. This means it is designed to move in a specific way relative to its target. It is also listed as an ETF that uses leverage to track performance.

What the numbers show

The current price of HOOG is $38.54. To understand how the price has changed, we can look at its estimated price from roughly one year ago, which was about $91.16.

The numbers show a significant share-price decline:

• Year-to-Date (YTD) Price Return: The share price has dropped by approximately 29.08%.

• One-Year Price Return: The share price has dropped by approximately 57.72%.

When looking at total returns (which include the impact of distributions), the one-year total return was approximately -52.74%. Note that the YTD total return is also listed as -29.08%, which matches the price return for that period.

Income and distribution explanation

This ETF has a distribution yield of approximately 17.35%. This number describes the cash distributions relative to the ETF's price. However, it is important to remember that a high distribution yield does not mean an investor earned that percentage as a total return.

The distributions for this fund are described as "irregular" or "less frequent," with one payout recorded in the last 12 months.

NAV erosion explanation

This ETF has a severe erosion-risk flag. This means StockValueFinder's screening rules detected substantial price deterioration and a weak erosion score. The fund has an erosion score of 10, which is labeled as "Severe price erosion."

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the fund's underlying assets). While a falling market price is a share-price decline, the high erosion score and severe risk flag are indicators used to measure the risk of value loss within the fund.

Pros

• The fund provides a high distribution yield of approximately 17.35%.

Cons

• There has been a significant share-price decline over the last year.

• The fund carries a severe erosion-risk flag and a "Severe price erosion" label.

• Distributions are irregular and less frequent.

Beginner takeaway

When looking at ETFs, high yields can sometimes be misleading. A very high distribution yield can exist even when the share price is falling significantly. In the case of HOOG, the high yield is accompanied by a large decline in share price and a severe erosion-risk warning. Always distinguish between "price return" (how the share price moves) and "total return" (the overall result including distributions).