ETF Education Report: ProShares UltraShort 7-10 Year Treasury (PST)

What this ETF is trying to do

The ProShares UltraShort 7-10 Year Treasury (PST) is a specialized type of fund. It is labeled as both "leveraged" and "inverse." This means it is designed to move in the opposite direction of 7-10 year Treasury bonds, often with more intensity than a standard investment.

What the numbers show

When looking at how this ETF has performed, it is important to look at two different types of numbers: price return and total return.

• Price Return: This only measures how much the share price itself has changed.

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

Based on the data provided:

• Year-to-Date (YTD): The price return is approximately 11.33%, while the total return is approximately 12.54%.

• One Year: The price return was approximately 10.95%, while the total return was approximately 14.27%.

• Three Years: The price return was approximately 2.76%, while the total return was approximately 13.99%.

To give you an idea of price movement, the estimated price from roughly one year ago was $22.21. The current price is $24.65.

Income and distribution explanation

Some investors look for ETFs that pay out cash. This ETF has a distribution yield of approximately 2.67%. It usually pays these distributions quarterly, and it has made four payments in the last 12 months. It is important to remember that a distribution yield tells you how much cash was paid out relative to the price, but it is not the same thing as your total return.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases significantly over time. StockValueFinder uses an "erosion-risk score" to help monitor this. For PST, the erosion score is 100, and the label shows "No price erosion detected." There is no severe erosion-risk flag for this ETF.

Pros

• The fund has shown positive total returns over the one-year, three-year, and five-year periods.

• It provides a distribution yield for those looking for regular cash payments.

Cons

• This is a leveraged and inverse ETF, which means it carries different risks than a standard fund.

• The price return and total return are different; the share price alone does not show the full picture of what an investor earned.

Beginner takeaway

When studying this ETF, always distinguish between the share price and the total return. Because this fund is leveraged and inverse, its price moves differently than standard bond funds. Always look at the total return to see how much value was created including the cash distributions paid out.