ETF Education Report: Macquarie Global Infrastructure Total Return Fund Inc (MGU)

What this ETF is trying to do

The Macquarie Global Infrastructure Total Return Fund Inc (MGU) is an exchange-traded fund (ETF) listed on the NYSE. While the specific investment goals are not detailed in the data, the name suggests it focuses on global infrastructure.

What the numbers show

It is important to understand the difference between "price return" and "total return." Price return only tracks how much the share price changes. Total return includes both the price change and any cash distributions paid out to investors.

Here is what the data shows for MGU:

• Year-to-Date (YTD): The YTD price return is approximately 0.44%. However, the YTD total return is higher at approximately 1.55%.

• One Year: The one-year price return was a decline of approximately -2.65%. When including distributions, the one-year total return was approximately 3.86%.

• Three Years: The three-year price return was approximately 14.04%, while the three-year total return was approximately 36.95%.

To visualize the one-year price change, we can look at an estimated price from roughly one year ago, which was approximately $23.44. The current price is $22.82. If you had invested $10,000 into this ETF one year ago, the share price alone would have dropped to about $9,735 before accounting for any cash payments.

Income and distribution explanation

This ETF has a distribution yield of approximately 6.57%. This represents the cash distributions relative to the ETF's price. The fund usually pays these out monthly, with 12 distributions recorded over the last year.

It is important to remember that a high distribution yield does not mean an investor earned that same percentage as a total return. Distributions provide cash income, but they do not guarantee that your original investment (your principal) will stay the same value.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases. While a falling market price is a "share-price decline," it does not always mean the NAV has declined.

For MGU, the erosion-risk score is 100, and the erosion label is "No price erosion detected." The erosion severity is rated as "good," and there is no severe erosion-risk flag.

Pros

• The fund has a positive three-year total return of approximately 36.95%.

• It provides regular cash distributions (usually monthly).

Cons

• The one-year price return shows a share-price decline of approximately -2.65%.

• There is no data provided regarding specific top holdings to show what companies the fund owns.

Beginner takeaway

When looking at ETFs, always check both the price return and the total return. A fund's share price might go down, but the total return can be higher if the fund pays out regular distributions. However, high yields can sometimes be misleading if the share price is also falling significantly.