Understanding the Nuveen Select Maturities Municipal Fund (NIM)

What this ETF is trying to do

The Nuveen Select Maturities Municipal Fund (NIM) is an ETF traded on the NYSE. While the specific investment goals are not listed in the data, municipal funds generally focus on providing income through municipal bonds.

What the numbers show

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

• Price return only tracks how much the share price itself has changed.

• Total return includes both the price changes and the cash distributions (dividends) paid out to investors.

For NIM, the numbers show different trends depending on how long you look:

• Year-to-Date (YTD): The price return is approximately -7.52%, while the total return is approximately -4.91%.

• One Year: The price return is approximately -7.60%, while the total return is approximately -4.11%.

• Three Years: The price return is approximately 1.77%, while the total return is much higher at approximately 13.93%.

To visualize the price change, we can look at an estimated price from roughly one year ago, which was about $9.32. The current price is $8.61.

Income and distribution explanation

This ETF provides cash distributions to investors. The distribution yield is approximately 4.04%. These payments usually happen monthly, with the most common day for a payment being Friday. Over the last 12 months, there were 12 payments totaling $0.348 per share.

It is important to remember that a high distribution yield does not mean you are earning that same amount in total return. You must look at the total return to see how the investment performed overall.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases over time. StockValueFinder uses an "erosion-risk score" to measure this risk.

For NIM, the erosion-risk score is 75, which is labeled as "Mild price erosion." This is a measurement of risk and does not mean the fund's value has definitely collapsed, but it suggests there has been some decline in price.

Pros

• The three-year total return is positive at approximately 13.93%.

• The fund provides regular monthly cash distributions.

Cons

• The one-year and year-to-date price returns have been negative.

• There is a measurement of "mild" price erosion.

Beginner takeaway

When looking at NIM, notice that the total return is higher than the price return. This happens because the cash distributions help offset some of the share-price decline. However, because the price has been falling recently, investors should distinguish between the cash they receive and the changing value of their original investment.