- What does SCDL invest in?
- SCDL provides 2x leveraged exposure to the Dow Jones US Dividend 100 Index. This market-capitalization-weighted benchmark systematically excludes Real Estate Investment Trusts and screens for companies with a consistent dividend payment history of at least ten years. The portfolio's selection is guided by several key fundamental metrics, including cash-flow to debt ratio, return on equity (ROE), dividend yield, and dividend growth rates. This investment methodology often leads to a slight large-cap bias and distinct sector allocations, favoring industrial and consumer-oriented firms while having reduced exposure to financials. A key differentiator for SCDL, compared to other ETNs, is that it does not pay any coupon and resets its leverage quarterly, rather than daily. Furthermore, akin to all ETNs, SCDL's value is dependent on the credit risk of its issuing bank, UBS, and is not directly backed by underlying stocks. The index it tracks is reviewed annually and rebalanced every quarter.
- What is the expense ratio of SCDL?
- ETRACS 2x Leveraged US Dividend Factor TR ETN (SCDL) charges an expense ratio of 0.95%. This is the annual fee deducted from fund assets to cover management and operations.
- Is SCDL a good long-term hold?
- SCDL is a leveraged fund designed to deliver a daily multiple of its underlying index. Daily reset compounding means returns over multi-day periods can diverge significantly from the headline multiple — typically negative drift in choppy markets. These funds are designed for short-term tactical use, not buy-and-hold. Review the fund's prospectus before holding more than a few days.
- How does SCDL's daily reset work?
- SCDL rebalances exposure each trading day to maintain its target leverage ratio against the next day's move. The daily reset means returns compound at the daily level — so a +1%, −1% sequence on the underlying doesn't return the underlying to flat after the leverage multiplier. Over time this path-dependence erodes returns in volatile markets and amplifies them in trending markets.
- How big is SCDL?
- ETRACS 2x Leveraged US Dividend Factor TR ETN (SCDL) manages $9.2M in total assets. AUM determines bid-ask liquidity and the fund's vulnerability to closure — funds below ~$50M are at higher risk of liquidation.
- Is SCDL actively managed or an index fund?
- SCDL's management style is described in the fund's prospectus. See the description on the Summary tab for the published strategy.
