As advisors and investors search for more income in today’s low-yield environment, unique solutions are more important than ever. One growing ETF option is the Strategy Shares Nasdaq 7 Handl Index ETF (HNDL).
HNDL seeks investment results that correlate generally to the price and yield performance of the NASDAQ 7 HANDL™ Index. The index consists of securities issued by exchange-traded funds (“ETFs”) and is split into two components, with a 50% allocation to fixed income and equity ETFs (the “Core Portfolio”) and a 50% allocation to ETFs of 12 asset categories (the “Explore Portfolio”).
The strategy is resonating with end users of exchange traded funds as HNDL recently joined the $100 million in assets under management club. That’s good for asset growth of more than 300% since the start of this year.
“We are thrilled that the HNDL ETF has rapidly surpassed the $100 million AUM milestone,” said Jerry Szilagyi, CEO of Rational Advisors, Inc., the investment advisor for Strategy Shares. “HNDL ETF’s consistent 7% distribution rate has offered an attractive option for addressing the challenges of meeting cash flow needs in a zero-yield world without requiring investors to take on unacceptable credit risk.”
Get a Handle on the HNDL ETF
The Long-Term focus part of the HNDL portfolio includes allocations to broad-based, cost-efficient fixed income ETFs as well as equity funds, such as the Invesco QQQ Trust (QQQ ).
“The Nasdaq 7HANDL ETF has adopted a policy to pay monthly distributions on Fund shares at a target rate that represents an annualized payout of approximately 7.0% on the Fund’s per-share net asset value on the date of a distribution’s declaration,” according to StrategyShares. “All or a portion of a distribution may consist of a return of capital from the original investment and the distribution rate may be modified at any time.”
The ETF’s portfolio is split into two equally-weighted categories, a Core Portfolio and a Dorsey Wright Explore Portfolio. The Core Portfolio includes a long-term focus with a 70% tilt toward U.S. aggregate fixed-income assets and 30% in U.S. large-cap equities. Meanwhile, the Dorsey Wright Explore Portfolio is takes a tactical allocation stance with U.S. fixed-income, U.S. blend, U.S. equity and U.S. alternative assets, or categories that have historically provided high levels of income. Both halves are rebalanced on a monthly basis.
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