8/19/2023 0 Comments Notional value of dia etf![]() The different weightings they can target also introduce more flexibility to the fund. With the fund's strategy of writing calls against both index and underlying positions, they utilize a more flexible strategy. A Look At DIAX's Portfolio, Odd Positioning At the same time, like most option-writing funds, the fund's expense ratio is also quite competitive in the closed-end fund space. The fund is also a fair size, which generally provides enough liquidity for retail investors. There is no leverage to add to volatility - which would seemingly make sense as they are looking to tamp down on the overall volatility. ![]() Overall, it's quite a simple strategy and isn't anything too exotic. The BasicsĭIAX's investment objective is "to offer regular distributions through a strategy that seeks attractive total returns with less volatility than the Dow Jones Industrial Average (DJIA or "Dow 30")." In an attempt to achieve this objective, the fund will invest "in an equity portfolio that seeks to substantially replicate the price movements of the DJIA, as well as selling call options on 35-75% of the notional value of the Fund's equity portfolio (with a 55% long-term target) in an effort to enhance the Fund's risk-adjusted returns." As of their last report, the fund was overwritten by 50%. The DJIA has been the laggard with growth rebounding. Of course, we know so far in 2023 the opposite has been true. However, unlike the S&P 500 and Nasdaq, which were bogged down severely by growth names, the Dow Jones Industrial Average held up relatively better. The fund road the highs through the end of 2021 like the broader market did, only to see more muted results in 2022. Since our last update, the fund's performance has been relatively flat on a total return basis.ĭIAX Performance Since Prior Update (Seeking Alpha) Conversely, a discount/premium that is running higher than a fund's historical range can often indicate a name worth potentially selling. Generally speaking, looking for discounts that are wider than usual can indicate something is worth looking into further for a potential opportunity. To catch my attention was the fund going to a relatively larger discount compared to its own historical level once again.Ī discount on its own isn't necessarily a good determining factor if a fund is attractive or not. Since then, the discount narrowed, and it wasn't brought up until more recently. Nuveen Dow 30 Dynamic Overwrite Fund ( NYSE: DIAX) is a name I last touched on over two years ago when it was trading at a large discount. This article was originally published to members of the CEF/ETF Income Laboratory on May 17th, 2023. Further information about the ETFs can be found at by Nick Ackerman, co-produced by Stanford Chemist. This notional distribution acts as the sole distribution for 2021.Īs of December 31, 2021, the ETFs each qualified as mutual fund trusts and, under Canadian tax law, have a deemed tax year-end as a financial institution of December 31, 2021. The ETFs are not expected to have a quarterly cash distribution, unless SmartBe changes the frequency of the distributions, which would be announced in a press release. The ETFs were launched on Januand SmartBe decided to accumulate the income and capital gains from each quarter. The March 31, June 30, and September 30 cash distributions for the above ETFs were nil. Unitholders of record on Decemwill receive the reinvested distribution. ![]() The reinvested distribution is considered a notional distribution and is automatically reinvested in units of the ETFs at the time of the distribution and immediately consolidated so that the number of units held by each investor, the outstanding units of the ETFs and the net asset value of the units of the ETFs do not change as a result of the distribution. SmartBe Canadian Quantitative Value Index ETF SmartBe Canadian Quantitative Momentum Index ETF
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