How We Score Income Funds
Every fund reviewed on Dependable Income Investing is independently scored using our 13-factor Fund Report Card — a structured evaluation system built specifically for retirement income investors. Each fund receives two scores: an Overall Score reflecting its complete profile, and a Dependability Score focused on the single question that matters most in retirement: can I depend on this fund to pay me reliably?
Our scoring is based on publicly available fund data — filings, fund documents, price history, and distribution records — not marketing materials or fund company claims.
The Overall Score
The Overall Score evaluates a fund across three weighted categories containing 13 individual criteria. Each criterion is rated 1–5 by our analysts, and the ratings are combined within each category before being weighted to produce the final composite score.
Category weights
| Category | Weight | What it measures |
|---|---|---|
| Fund Attributes | 20% | Cost, company backing, track record, and size |
| Risk | 35% | Volatility, diversification, and underlying asset quality |
| Return | 45% | Income generation, distribution consistency, and price history |
All 13 criteria
Fund Attributes (20% of Overall Score)
| Criterion | Weight within category | What we look at |
|---|---|---|
| Fund History | 40% | Years since inception — longer history means more market conditions tested |
| Fund AUM | 30% | Assets under management — larger funds are more liquid, less likely to close. Popular funds tend to be better — follow the money! |
| Expense Ratio (MER) | 25% | Annual cost of ownership — fees come directly out of income returns |
| Fund Company Size | 5% | Total AUM managed by the fund company — signals institutional stability |
Risk (35% of Overall Score)
| Criterion | Weight within category | What we look at |
|---|---|---|
| Volatility | 30% | Beta vs. S&P 500 and standalone price variability over the fund's full history |
| Fund Risk | 25% | Standardized risk classification from official fund documents (ETF Facts in Canada, Morningstar in the US) |
| Sector Diversification | 20% | Number of sectors with meaningful weight — concentration in one sector amplifies risk |
| Underlying Assets | 20% | What the fund actually holds — stocks, synthetics, derivatives, bonds, or other funds |
| Geographic Diversification | 5% | Country exposure — funds concentrated in one market carry country-specific risk |
Return (45% of Overall Score)
| Criterion | Weight within category | What we look at |
|---|---|---|
| Yield | 30% | Average annualised dividend yield over the fund's full history — not just the current figure |
| Yield Stability | 30% | Consistency of distribution amounts over the fund's full history |
| Capital History | 20% | Share price trend over the fund's full history — sustained NAV erosion is a red flag |
| Distribution Frequency | 20% | How often the fund pays — weekly and monthly are preferred for income investors |
The Dependability Score
The Dependability Score is a separate weighted composite drawn from the six criteria that matter most to retirement income investors. It is designed to answer one question directly: how reliably will this fund pay me?
The six factors are split into two groups — Risk (45% of the score) and Return (55% of the score) — reflecting that income reliability depends on both what a fund pays and how safely it does so.
Risk factors (45% of Dependability Score)
| Factor | Weight within group | Why it matters for retirement income |
|---|---|---|
| Volatility | 40% | High price volatility threatens capital and can force selling at the wrong time |
| Fund Risk | 35% | The fund's official risk classification reflects risks that may not be visible in recent returns |
| Underlying Assets | 25% | What a fund holds determines the quality and durability of the income it generates |
Return factors (55% of Dependability Score)
| Factor | Weight within group | Why it matters for retirement income |
|---|---|---|
| Yield Stability | 35% | Unpredictable distributions make household budgeting difficult and often signal a fund under stress |
| Yield | 35% | The actual income level relative to the fund's full history — not its current marketing figure |
| Capital History | 30% | A fund eroding its Net Asset Value (NAV) while paying income is returning your own capital — not sustainable |
Full factor-level scores and analyst notes are available in the Dependable Income Investing app.
Scoring scale
Criterion ratings
Each of the 13 criteria is rated 1–5 by our analysts:
| Rating | Label | What it means |
|---|---|---|
| 5 | Strength | Exceptional — a meaningful positive for income investors |
| 4 | Good | Above average — performs well on this dimension |
| 3 | Acceptable | Average — neither a strength nor a concern |
| 2 | Weakness | Below average — warrants attention before investing |
| 1 | Concern | Significant issue — income investors should understand this risk |
Ratings of 4 or 5 are flagged as Strengths. Ratings of 1 or 2 are flagged as Weaknesses. These flags appear directly on every review page.
Letter grades
The Overall Score and Dependability Score are each expressed as a percentage (0–100%) and a letter grade:
| Score | Grade |
|---|---|
| 90%+ | A+ |
| 80–89% | A |
| 77–79% | A− |
| 74–76% | B+ |
| 70–73% | B |
| 67–69% | B− |
| 64–66% | C+ |
| 60–63% | C |
| 50–59% | D |
| Below 50% | F |
A score of 67% or above (B- or better) indicates a fund that meets our baseline standard for reliable retirement income. Scores below 60% indicate meaningful concerns that income investors should investigate before investing.
Data sources and update frequency
All fund data is sourced from publicly available information: official fund documents (prospectus, ETF Facts, fund webpage), price and distribution history, and regulatory filings. We do not rely on fund company marketing materials for scoring inputs.
Funds must have at least one year of trading history to be reviewed. This ensures enough price and distribution data exists to score the Return and Risk criteria meaningfully.
Fund scores are reviewed and updated periodically as new data becomes available. Each review page displays a Review date. If a fund's profile changes materially — a major distribution cut, strategy shift, or assets under management (AUM) decline — it is flagged for priority re-review.
Frequently asked questions
- What is the Dependability Score?
- The Dependability Score is a 0–100% composite of the six criteria most critical to retirement income reliability: Yield Stability, Yield, Volatility, Capital History, Fund Risk, and Underlying Assets. A score above 67% indicates a fund with a strong track record of reliable income delivery. It is separate from the Overall Score, which covers all 13 criteria including cost and fund size.
- What is the difference between the Overall Score and the Dependability Score?
- The Overall Score reflects the complete Fund Report Card across all 13 criteria — including expense ratio, fund company size, and geographic diversification. The Dependability Score focuses only on the six factors that most directly determine whether a fund will pay you reliably in retirement. A fund can score well overall but have a lower Dependability Score if its distributions are inconsistent or its capital history shows NAV erosion.
- How does Dependable Income Investing rate income ETFs?
- Each fund is scored by our analysts across 13 criteria in three categories — Fund Attributes, Risk, and Return. Every criterion receives a 1–5 rating based on publicly available data. The categories are weighted (Fund Attributes 20%, Risk 35%, Return 45%) and combined into an Overall Score from 0–100%. A separate Dependability Score is then calculated from six income-specific factors.
- Why do funds need at least one year of history to be reviewed?
- The most important criteria in our scoring — Yield Stability, Capital History, and Volatility — require a meaningful data series to evaluate honestly. A fund with six months of history has likely operated in one type of market environment. One year is a minimum; three or more years gives a much clearer picture of how a fund behaves through rate changes, corrections, and volatility spikes.
- How often are scores updated?
- Fund scores are updated periodically throughout the year. Each review page displays a review date. Scores are prioritised for update when significant fund events occur — distribution cuts, strategy changes, or large AUM movements.
- Where can I see the full scores for a specific fund?
- The complete 13-factor breakdown — including all Risk and Return criterion scores, analyst notes, and the full Dependability Score — is available in the Dependable Income Investing app. The premium plan includes access to the fund review library.
Want the full explanation?
For a detailed walkthrough of each criterion — what it means, why it matters, and how to interpret it — see our guide: How to Review an Income Fund (ETF) →
To score any fund yourself using our template: Fund Report Card →