Share-split context: A reverse split was recorded on Sep 29, 2025 with coefficient 0.1. A reverse split combines multiple old shares into fewer new shares and mechanically raises the quoted price per share. That mechanical increase does not restore lost investment value. The returns in this report are already split-adjusted, while reverse-split history remains a separate structural warning.

ETF Education Report: NVDD

NVDD (Direxion Daily NVDA Bear 1X Shares) is an inverse single-stock ETF. It is designed to move in the opposite direction of NVIDIA's stock price. This means if NVIDIA's stock price goes down, NVDD is designed to go up.

What the Numbers Show

The data shows a significant decline in share price over several timeframes. The year-to-date (YTD) price return is -27.74%, and the one-year price return is -29.92%. Over three years, the price return has dropped by -88.68%.

When looking at total return—which includes distributions—the numbers are similar:

• YTD Total Return: -25.44%

• One-Year Total Return: -27.04%

• Three-Year Total Return: -87.29%

NVDD has a history of reverse splits. Most recently, on September 29, 2025, a reverse split occurred with a coefficient of 0.1. In a reverse split, multiple old shares are combined into fewer new shares, which mechanically raises the per-share price. This mechanical increase does not restore lost investment value.

Income and Distribution Explanation

NVDD has a distribution yield of approximately 4.91%. Over the last 12 months, it has made 4 payments, usually on a quarterly basis.

It is important for new investors to remember that a distribution yield is not the same as a total return. While NVDD provides some cash income, the total return figures show that the share-price decline has been much larger than the income provided.

Price and NAV Erosion Explanation

The supplied data is sufficient to evaluate price erosion, but it does not include enough historical NAV-per-share data to confirm or rule out NAV erosion.

However, the data does show significant price erosion. NVDD has an erosion score of 30 and a "significant" erosion severity label. Additionally, a severe erosion-risk flag is active. This flag was triggered because the split-adjusted price trend and the erosion score indicate substantial price deterioration.

Pros

• Inverse Strategy: Provides a way to bet against the price of a single stock (NVIDIA).

• Regular Income: Provides quarterly cash distributions.

Cons

• Severe Price Decline: The ETF has seen very large price drops over one and three years.

• Reverse Split History: The fund has had to combine shares to keep the price from falling too low.

• Low Income Grade: It has an income rating grade of "F."

Beginner Takeaway

NVDD is a specialized tool used to profit from a decline in NVIDIA's stock. Because it is an inverse fund, it can be very risky if the underlying stock continues to rise. Investors should notice that a high distribution yield can be misleading if the share price is falling rapidly at the same time.