Q: Thanks for all the great work you do.
To obtain the total return HXS adds the dividend to the NAV.
My question is, is this distributed say quarterly or annually, or is this done throughout the ex div dates of all the S&P holdings (seems like a lot of math).
Thank you
To obtain the total return HXS adds the dividend to the NAV.
My question is, is this distributed say quarterly or annually, or is this done throughout the ex div dates of all the S&P holdings (seems like a lot of math).
Thank you
5i Research Answer:
Dividends are not quite 'added' here. HXS enters into derivative contracts with third parties (banks) to provide a 'total return' comparable to the S&P 500 index. Often, it will not own ANY stocks at all and only has the derivative contracts. Full details on every contract are not disclosed, but we would expect these to roll over quarterly in order for the third party to capture the actual dividends paid on a regular basis and to provide the similar returns back to the ETF via the contracts.