ETF Education Report: SEI DBI Multi-Strategy Alternative ETF (QALT)

What this ETF is trying to do

The SEI DBI Multi-Strategy Alternative ETF, trading under the ticker QALT on the NASDAQ, is an exchange-traded fund. While the specific investment strategy is not detailed in the provided data, it is categorized as an "alternative" asset type ETF.

What the numbers show

When looking at how this ETF has performed, 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. For QALT, the year-to-date (YTD) price return is approximately 5.86%. The one-year price return is approximately 2.55%.

• Total Return: This includes the share price change plus any distributions (cash payments) made to investors. The YTD total return is approximately 7.78%, and the one-year total return is approximately 9.82%.

To visualize the price change, we can look at an estimated example. The current price is $26.39. The estimated price from roughly one year ago was approximately $25.73.

Income and distribution explanation

Some investors look for ETFs that pay out cash, known as distributions. QALT has a distribution yield of approximately 6.65%. This means the cash distributed is about 6.65% of the ETF's price. Over the last 12 months, there were 5 payouts. These distributions usually happen on a quarterly basis, and most recently, they have been paid out on Mondays.

It is important to remember that a high distribution yield is not the same thing as total return. Total return tells you the full picture of how much value was gained, including those cash payments.

NAV erosion explanation

"NAV erosion" refers to a situation where the Net Asset Value (the actual value of the assets held by the fund) decreases over time. Investors often watch this because they want to know if their initial investment is staying stable.

For QALT, the erosion-risk score is 94, which is labeled as "Stable / sideways." The erosion severity is described as "good," and there is no severe erosion-risk flag present. This suggests the fund's price movement has been relatively stable according to these measurements.

Pros

• The ETF shows a positive total return for both the year-to-date and one-year periods.

• The erosion-risk measurements suggest a stable price trend.

Cons

• Data for the three-year return was not supplied.

• The top holdings list is currently empty in the provided data.

Beginner takeaway

When studying an ETF like QALT, always look at the total return rather than just the price or just the yield. The total return shows you how much the investment grew when you include both the rising share price and the cash distributions. Additionally, while high yields can provide extra cash, they do not guarantee that the share price will stay the same.