Understanding the ClearShares Piton Intermediate Fixed Income ETF (PIFI)

What this ETF is trying to do

The ClearShares Piton Intermediate Fixed Income ETF, known by its ticker symbol PIFI, is an exchange-traded fund (ETF) that trades on the NYSE. This type of fund focuses on fixed income, which generally means it deals with bonds or other debt-related investments.

What the numbers show

When looking at an ETF, it is important to understand two different types of returns: price return and total return.

• Price Return: This measures only the change in the share price.

• Total Return: This includes both the change in share price and any cash distributions (dividends) paid out to investors.

For PIFI, the numbers show different results depending on how much time has passed:

• Year-to-Date (YTD): The price return is approximately -4.20%, while the total return is approximately -1.64%.

• One Year: The price return is approximately -4.24%, while the total return is approximately -0.83%.

• Three Years: The price return is approximately 1.98%, while the total return is much higher at approximately 11.98%.

To give you an idea of the price movement, the estimated price from roughly one year ago was $94.86. The current price is $90.83.

Income and distribution explanation

Some investors look at ETFs for regular cash payments, called distributions. PIFI has a distribution yield of approximately 3.61%. This number describes the cash distributions relative to the current ETF price. Over the last 12 months, there were 4 payouts. These distributions usually happen on a quarterly basis.

It is important to remember that a distribution yield is not the same as total return. While distributions provide cash, they do not guarantee that your original investment 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 over time. StockValueFinder uses an erosion-risk score to measure this risk.

PIFI has an erosion score of 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag for this ETF. This suggests that the fund's value has not shown signs of significant structural decay according to these specific measurements.

Pros

• Higher Total Returns over time: While recent price returns have been negative, the three-year total return is positive at approximately 11.98%.

• Stable Erosion Score: The erosion-risk measurements suggest the fund is currently stable.

Cons

• Recent Price Declines: Both the year-to-date and one-year price returns have been negative.

• Price vs. Total Return Gap: The total return is higher than the price return, meaning much of the value comes from distributions rather than the share price going up.

Beginner takeaway

When studying PIFI, notice the difference between the share price and the total return. While the share price has dropped recently, the total return (which includes cash payments) is closer to zero. Always remember that a high distribution yield provides cash, but it does not prevent the share price from falling.