Understanding the Direxion Daily QCOM Bear 1X ETF (QCMD)

What this ETF is trying to do

The Direxion Daily QCOM Bear 1X ETF (ticker: QCMD) is an inverse ETF. This means it is designed to move in the opposite direction of a specific underlying asset. Because it is an inverse fund, it aims to provide the opposite performance of its target.

What the numbers show

The recent data shows a decline in the share price of QCMD.

• Year-to-Date (YTD) Performance: The YTD price return is approximately -26.07%. When looking at the total return (which includes distributions), the YTD figure is approximately -24.53%.

• One-Year Performance: Over the last year, the price return was approximately -29.61%. The one-year total return was approximately -27.52%.

• Price Comparison: The current price is $16.02. An estimated price from roughly one year ago was approximately $22.76.

It is important to note that "price return" only tracks the change in the share price, while "total return" includes the impact of distributions.

Income and distribution explanation

QCMD has a distribution yield of approximately 3.46%. The fund typically pays distributions on a quarterly basis, with 4 payouts recorded over the last 12 months. The most recent trailing distributions totaled approximately $0.55 per share.

While the fund provides these cash payments, a high distribution yield does not mean an investor has earned that amount as a total return. In this case, the share price has declined significantly during the same period.

NAV erosion explanation

This ETF has a severe erosion-risk flag. This means that StockValueFinder's screening rules detected significant price deterioration. The fund has an erosion score of 30, which is labeled as "Significant price erosion" with a severity level of "significant."

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. While the market price of the shares has dropped, we cannot use this price-based evidence to prove whether the Net Asset Value (NAV) itself has declined.

Pros

• The fund provides regular cash distributions, typically occurring on Tuesdays.

• It offers a way to express an inverse view of its target asset.

Cons

• The fund has experienced significant share-price declines over the last year and year-to-date.

• There is a severe erosion-risk flag due to the downward price trend.

• The income rating for this fund is an "F" grade, with an income rating score of 29.

Beginner takeaway

QCMD is an inverse ETF that has seen its share price drop by nearly 30% over the last year. While it pays a distribution yield of about 3.46%, the declining share price means the total return is negative. Investors should be aware of the severe erosion-risk flag, which highlights the significant decline in the fund's price.