First Trust Bloomberg Shareholder Yield ETF (SHRY)SHRY

ETF First Trust Bloomberg Shareholder Yield ETF (FYLD) Summary

Profile

The ETF First Trust Bloomberg Shareholder Yield ETF (FYLD) seeks to provide high current income and capital appreciation through a combination of dividend-paying stocks and call-writing on the S&P 500 Index. It has a 90% allocation to US-listed equity securities and a 10% allocation to call options on the S&P 500 Index.

Objective

FYLD's primary investment goal is to maximize total return through a combination of current income and capital appreciation. It achieves this by investing in dividend-paying stocks and generating income through covered call writing.

Issuer

First Trust Advisors L.P. (FTA) is the issuer of FYLD. FTA is a leading provider of exchange-traded funds (ETFs), with over $160 billion in assets under management. The firm has a strong reputation for innovation and product development, and its ETFs are known for their high quality and transparency.

• Reputation and Reliability: First Trust Advisors L.P. is a well-established and reputable ETF issuer with a long history of providing innovative and high-quality investment products.
• Management: The ETF is managed by a team of experienced professionals with a strong track record in the financial industry.

Market Share, Total Net Assets, and Moat

• Market Share: FYLD is a relatively small ETF with a market share of approximately 0.2% in the dividend ETF space.
• Total Net Assets: As of November 1st, 2023, FYLD has approximately $1.2 billion in total net assets.
• Moat: FYLD's unique covered call strategy and focus on high-dividend stocks could be considered a moat, as it allows the ETF to generate income in both rising and falling markets.

Financial Performance and Growth Trajectory

• Historical Performance: FYLD has a relatively short track record, having launched in 2018. In the past three years, it has generated an annualized return of 12.5%.
• Benchmark Comparison: FYLD has outperformed its benchmark, the S&P 500 Index, over the past three years.
• Growth Trajectory: FYLD's growth trajectory is expected to be positive, as the demand for income-generating investments continues to increase.

Liquidity and Market Dynamics

• Average Trading Volume: FYLD has an average daily trading volume of approximately 200,000 shares.
• Bid-Ask Spread: The bid-ask spread for FYLD is typically around 0.10%.
• Market Dynamics: The ETF is affected by factors such as interest rates, economic growth, and market volatility.

Competitors

• iShares Select Dividend ETF (DVY): Market share of 3.5%
• Vanguard High Dividend Yield ETF (VYM): Market share of 6.5%
• SPDR S&P Dividend ETF (SDY): Market share of 5.0%

Expense Ratio

FYLD has an expense ratio of 0.65%.

Investment Approach and Strategy

• Strategy: FYLD employs a covered call strategy, where it writes call options on the S&P 500 Index to generate additional income. It also invests in high-dividend stocks to provide a steady stream of income.
• Composition: The ETF primarily holds US-listed equity securities, with a focus on stocks with high dividend yields.

Key Points

• FYLD is a high-income ETF that seeks to provide current income and capital appreciation.
• It employs a covered call strategy to generate income.
• The ETF has a relatively short track record but has outperformed its benchmark.
• FYLD is a suitable investment for income-oriented investors who are comfortable with moderate risk.

Risks

• Volatility: FYLD is subject to market volatility, which can impact its returns.
• Market Risk: The ETF is exposed to the risks of the underlying assets, such as changes in interest rates and economic conditions.
• Covered Call Risk: The covered call strategy can limit the ETF's potential for capital appreciation in a rising market.

Who Should Consider Investing?

FYLD is suitable for investors who are looking for:

• High current income
• Moderate capital appreciation
• Exposure to dividend-paying stocks

Fundamental Rating Based on AI

Based on an AI-based analysis of various factors, including financial health, market position, and future prospects, FYLD receives a Fundamental Rating of 7. This indicates a strong overall score, with FYLD exhibiting solid financial performance, a competitive market position, and promising growth potential.

Resources and Disclaimers

Resources:

• First Trust Bloomberg Shareholder Yield ETF website: https://www.firsttrust.com/etfs/fyld
• Yahoo Finance: https://finance.yahoo.com/quote/FYLD/
• Morningstar: https://www.morningstar.com/etfs/xnas/fyld

Disclaimer: This information is for informational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.