ETF Education Report: SIMPLIFY US EQUITY PLUS CONVEXITY ETF (SPYC)

What this ETF is trying to do

The SIMPLIFY US EQUITY PLUS CONVEXITY ETF (ticker: SPYC) is an exchange-traded fund listed on the NYSE. While the specific strategy isn't detailed in the data, we can see what it holds to understand its focus. Its largest holding is the ISHARES CORE S&P 500 ETF, which makes up 99.12% of the fund. This suggests the ETF is heavily tied to the performance of large U.S. companies.

What the numbers show

When looking at an ETF, it is important to distinguish between "price return" and "total return." Price return only tracks how much the share price changes. Total return includes both the price change and any cash distributions paid out to investors.

Based on the supplied data:

• Year-to-Date (YTD): The price return is approximately 8.83%, while the total return is approximately 9.82%.

• One-Year: The price return was approximately 8.11%, and the total return was approximately 9.34%.

• Three-Year: The price return was approximately 65.76%, and the total return was approximately 71.25%.

For a visual example, the current price is $46.52. The estimated price from roughly one year ago was approximately $43.03.

Income and distribution explanation

Some investors look for ETFs that pay out cash, known as distributions. This ETF has a distribution yield of approximately 1.07%. It usually pays out on a quarterly basis and has made 4 payments over 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 over time. Some investors worry about this because they want their original investment (the principal) to stay stable. For SPYC, the erosion-risk score is 100, and the label states "No price erosion detected." There is no severe erosion-risk flag for this ETF.

Pros

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

• The erosion-risk measurement is rated as "good."

Cons

• The distribution yield (the cash paid out) is relatively low at approximately 1.07%.

• The top holdings list provided is partial, meaning there are other assets in the fund not shown here.

Beginner takeaway

When studying SPYC, notice that the total return is higher than the price return. This happens because the total return accounts for the cash distributions paid to investors. Always look at both numbers to get a full picture of how an ETF has performed.

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*Disclaimer: This report is for educational purposes only. It does not provide financial advice and does not recommend buying, selling, or holding this ETF.*