ETF Education Report: Nuveen Intermediate Duration Municipal Term Fund (NID)

What this ETF is trying to do

The Nuveen Intermediate Duration Municipal Term Fund (NID) is an ETF. While the specific investment strategy is not detailed in the provided data, ETFs like this one generally aim to provide a specific type of market exposure to investors.

What the numbers show

When looking at an ETF, it is important to separate the share price from the total return. The price return only shows how much the share price itself changed. The total return includes both the price change and any distributions (cash payments) made to investors.

Here is what the data shows for NID:

• Year-to-Date (YTD): The YTD price return is approximately -0.91%. The YTD total return is approximately -0.27%.

• One Year: The one-year price return is approximately -4.69%. The one-year total return is approximately -1.04%.

• Three Year: The three-year price return is approximately 7.79%. The three-year total return is approximately 20.79%.

To understand the share-price movement, we can look at an estimated price from roughly one year ago, which was approximately $13.64. The current price is $13.00. If you had invested $10,000 into this ETF one year ago, your investment would have dropped to approximately $9,531 based on the share-price decline alone, before accounting for any cash distributions.

Income and distribution explanation

This ETF has a distribution yield of approximately 3.8%. This number describes the cash distributions relative to the ETF's price. The data shows that this fund usually pays out distributions monthly, with 11 distributions recorded over the last 12 months.

It is important to remember that receiving regular cash distributions is not the same as earning a total return. A distribution provides cash income, but it does not guarantee that your original investment (your principal) will stay the same value.

NAV erosion explanation

"NAV" stands for Net Asset Value, which is the actual value of the assets held by the fund. "NAV erosion" happens when the value of those underlying assets drops significantly.

For NID, the erosion-risk score is 100, and the label is "No price erosion detected." The erosion severity is listed as "good," and there is no severe erosion-risk flag. This means that, based on these specific measurements, the fund does not show signs of substantial price deterioration related to erosion risks.

Pros

• The three-year total return has been positive at approximately 20.79%.

• The fund provides regular cash distributions (usually monthly).

Cons

• The one-year price return and total return have both been negative.

• The year-to-date price return is also negative.

Beginner takeaway

When looking at ETFs that pay income, high yields can sometimes be misleading. Investors often look for funds where the share price stays steady or goes up slightly. If a share price collapses, it can destroy the value of the initial investment, even if the fund is paying out cash. Always look at both the price return and the total return to see the full picture of how an ETF is performing.