Understanding the WisdomTree 1-3 Year Laddered Treasury Fund (USSH)

What this ETF is trying to do

The WisdomTree 1-3 Year Laddered Treasury Fund (ticker: USSH) is an exchange-traded fund (ETF). Based on its name, it focuses on U.S. Treasury securities with maturities between one and three years.

What the numbers show

When looking at an ETF, it is important to know the difference between "price return" and "total return."

• Price Return: This only measures how much the share price itself has changed.

• Total Return: This includes both the change in share price and any cash distributions (dividends) paid out to investors.

For USSH, the numbers show:

• Year-to-Date (YTD): The price return is approximately -2.16%. However, the total return is positive at about 0.46%.

• One-Year: The price return is approximately -2.17%. The total return for the year is approximately 1.43%.

To visualize this, we can look at an estimated price from roughly one year ago. The estimated price was $50.84, and the current price is $49.73. This shows that while the share price has gone down, the total return (which includes distributions) tells a different story.

Income and distribution explanation

This ETF provides cash to investors through distributions. The distribution yield is approximately 3.68%. This number describes the cash paid out relative to the current ETF price.

The fund usually pays distributions monthly, with 13 distributions recorded over the last year. Most of these payments have occurred on Tuesdays. It is important to remember that a high distribution yield does not guarantee that an investor's total return will be high.

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.

In this case, the fund has an erosion-risk score of 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag present.

Pros

• The fund provides regular cash distributions (usually monthly).

• The total return has remained positive over the last year, even though the share price declined.

• The erosion-risk score suggests a stable trend.

Cons

• The share price has experienced a decline over the year-to-date and one-year periods.

• The fund's income rating is a "C" grade with a score of 68.

Beginner takeaway

When studying USSH, notice how the share price and the total return move differently. Even though the price of a single share dropped over the last year, the total return was positive because of the cash distributions paid to investors. Always look at both price changes and distributions to get a full picture of how an ETF is performing.