What does the return of a UITF represent?

The return of a UITF represents the weighted average return of the underlying assets. This is because a UITF is structured to pool funds from multiple investors to create a diversified portfolio of investments, which may include stocks, bonds, or other asset classes. Each of these investments contributes to the overall return of the fund based on its individual performance and the size of its allocation in the portfolio.

This weighted average calculation considers both the individual returns of each asset held within the UITF and their proportionate impact on the total fund value. Therefore, the UITF's return accurately reflects the performance of its underlying investments rather than just a simplistic average or an arbitrary benchmark. By focusing on the weighted contributions from each asset class, investors gain a clearer view of how their investment is performing based on the actual assets that the UITF holds.