ETF Education Report: HARBOR SCIENTIFIC ALPHA INCOME ETF (SIFI)

What this ETF is trying to do

The HARBOR SCIENTIFIC ALPHA INCOME ETF (ticker: SIFI) is an exchange-traded fund listed on the NYSE. While the specific investment strategy is not detailed in the data, the name suggests it focuses on generating income.

What the numbers show

It is important to understand that "price return" and "total return" are two different things. Price return only tracks how much the share price moves. Total return includes both the price movement and the cash distributions paid out to investors.

Here is what the data shows for SIFI:

• Year-to-Date (YTD): The price return is approximately -2.68%. However, the total return is positive at about 0.60%.

• One Year: The price return was approximately -4.33%, while the total return was about 1.90%.

• Three Year: The price return was approximately 1.52%, but the total return was much higher at about 21.87%.

To visualize the price change, we can look at an estimated price from roughly one year ago. The estimated price was about $44.62, and the current price is $42.69.

Income and distribution explanation

This ETF provides cash distributions to investors. The distribution yield is approximately 6.48%. This means the amount of cash paid out is about 6.48% relative to the ETF's price. These payments usually happen monthly, with 12 payments recorded over the last year.

When looking at income, remember that a high distribution yield does not mean your total return will be that same percentage. Total return is the most complete way to see how much value an investment has actually provided.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases. Investors often care about this because they want their original investment (the principal) to stay stable while they collect income.

For SIFI, the erosion-risk score is 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag present. This suggests the fund's price movement is not currently showing signs of high erosion risk according to StockValueFinder's measurements.

Pros

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

• It provides regular monthly income with a distribution yield of approximately 6.48%.

Cons

• The share price has seen declines in both the year-to-date and one-year periods.

• There is no data provided regarding specific top holdings to show what companies the fund owns.

Beginner takeaway

When looking at an ETF like SIFI, it is helpful to look at the total return rather than just the share price. While the share price may go down, the total return accounts for the cash distributions you receive, which can help offset those price declines. Always remember that a high yield is not a guarantee of overall profit.