ETF Education Report: SP FUNDS S&P GLOBAL REIT SHARIA ETF (SPRE)

What this ETF is trying to do

The SP FUNDS S&P Global REIT Sharia ETF (ticker: SPRE) is an exchange-traded fund that focuses on real estate investment trusts (REITs). These are companies that own or manage properties like buildings and land. This specific fund follows Sharia principles, which means it selects investments based on certain religious guidelines.

What the numbers show

When looking at an ETF, it is important to know the difference between "price return" and "total return." Price return only tracks how much the share price moves. Total return includes both the price movement and any cash payments (distributions) made to investors.

Here is how SPRE has performed:

• Year-to-Date (YTD): The price return is approximately 0.53%, while the total return is approximately 3.31%.

• One Year: The price return was approximately 1.10%, while the total return was approximately 5.31%.

• Three Years: The price return was approximately 5.15%, while the total return was approximately 19.22%.

The current price is $19.68. An estimated price from roughly one year ago was approximately $19.47.

Income and distribution explanation

Some investors look for ETFs that pay out regular cash, known as distributions. SPRE has a distribution yield of approximately 4.25%. This number describes the cash payments relative to the ETF's price. Over the last 12 months, there were 13 distributions, which usually happen on a monthly basis.

It is important to remember that a high distribution yield does not mean the investor earned that same percentage as their total return. You must look at the "total return" figure to see the full picture of how the investment performed.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the assets held by the fund). While a falling share price can sometimes look like erosion, they are not always the same thing.

StockValueFinder uses an "erosion-risk score" to measure this risk. SPRE has an erosion score of 94, which is labeled as "Stable / sideways," and the severity is rated as "good." There is no severe erosion-risk flag for this ETF.

Top Holdings

The following are the top holdings in this fund (note that this list is partial):

• WELLTOWER INC: 12.99%

• PROLOGIS INC: 12.38%

• EQUINIX INC: 12.25%

• GOODMAN GROUP: 11.68%

• EASTGROUP PROPERTIES INC: 5.01%

Pros

• The fund provides a regular distribution (usually monthly).

• The erosion-risk score suggests the price has been relatively stable.

Cons

• The five-year total return was approximately -2.82%.

Beginner takeaway

When studying SPRE, notice that the total return is higher than the price return. This happens because the fund pays out distributions. Always check both numbers to understand how much value an ETF is creating or losing over time.