Special Report: Learn How This New ETF Aims to Provide a Steady 7% Annual Distribution Rate
There are 79 million baby boomers and every day 10,000 of them retire. Up until now, the asset management business has been focused on accumulation because that met the demographic trend. But now that trend is changing, and those people need to draw down and live off the assets they’ve spent their lives accumulating.
A new exchange traded fund, Strategy Shares Nasdaq 7HANDL Index ETF (HNDL), presents itself as a solution to this problem. This ETF says it’s the first designed to pay its investors a consistent monthly distribution. That distribution should equal 7% of the fund’s net asset value by the end of the year.
In an environment where interest rates are so low that people can’t afford to live off the 1% or less they receive on savings accounts or CDs or the 2% to 3% that U.S. Treasuries pay, a 7% annual payout looks very attractive.
“What’s unique is the 7% target distribution,” said David Miller, HNDL’s portfolio manager. “As opposed to just owning a diversified portfolio, investors wouldn’t have to go to the effort to sell part of their holdings to generate what they would get from the distributions.”