What used to be a decision between 40-50 buffered ETFs is now a choice between 400 or more. CEO Mike Loukas sat down with expert allocator Phon Vilayoune of Veta Investment Partners to discuss the pros and cons of different types of buffered ETF strategies so investors can choose the right ones for their clients.
Disclosures/Definitions:
- Capped Structures: A capped buffered ETF offers investors the chance to participate in an asset’s upside returns, but only up to a certain percentage. In exchange, the fund provides downside protection for a predetermined percentage of losses.
- Uncapped Structures: An uncapped buffered ETF is a type of exchange-traded fund (ETF) that offers uncapped returns on the upside after a certain performance threshold is met.
- 9 Buffer: A 9 Buffer Fund seeks to track the return of an index up to a predetermined cap, while buffering investors against the first 9% of losses over the outcome period.
- 10 Buffer: A 10 Buffer Fund seeks to track the return of an index up to a predetermined cap, while buffering investors against the first 10% of losses over the outcome period.
- 15 Buffer: A 15 Buffer Fund seeks to track the return of an index up to a predetermined cap, while buffering investors against the first 15% of losses over the outcome period.
- 20 Buffer: A 20 Buffer Fund seeks to track the return of an index up to a predetermined cap, while buffering investors against the first 20% of losses over the outcome period.
- 25 Buffer: A 25 Buffer Fund seeks to track the return of an index up to a predetermined cap, while buffering investors against the first 25% of losses over the outcome period.