We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
In this episode of ETF Spotlight, I speak with Matt Kaufman, Head of ETFs at Calamos, about Structured Protection ETFs, which allow investors to gain exposure to stock markets while protecting against downside risks.
The Calamos S&P 500 Structured Alt Protection ETF (CPSM - Free Report) aims to match the return of the SPDR S&P 500 ETF Trust (SPY - Free Report) up to a cap while promising 100% downside protection against the index’s losses over a one-year outcome period.
The Calamos Nasdaq-100 Structured Alt Protection ETF (CPNJ) provides protected exposure to the Nasdaq-100 index (QQQ - Free Report) . Calamos plans to roll out new ETFs every month.
Like other buffer ETFs, these products invest in a basket of FLEX options with varying strike prices. The strategy involves buying call options to gain index exposure and put options for downside protection, then offsetting the costs by selling call options, which caps upside returns.
Investors should remember that stocks tend to go up over the long term and that they should generally ignore short-term noise. Since its inception in January 1993, SPY has returned about 10.3% annualized. By seeking downside protection, investors forgo any potential upside beyond the cap.
At the same time, many risk-averse investors, particularly those in or nearing retirement, have been reluctant to buy stocks. There is a tremendous amount of cash sitting on the sidelines.
Some invest in products like fixed indexed annuities and market-linked CDs that protect against downside risks but come with much higher fees, high investment minimums, long lockup periods, and unfavorable tax treatment. Protection ETFs are a much better option for such investors.
The Innovator Equity Defined Protection ETF (TJUL - Free Report) , which provides 100% downside protection over a two-year outcome period, has gathered $220 million since launching in July last year.
Tune in to the podcast to learn more.
Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email podcast@zacks.com.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should You Buy ETFs with 100% Loss Protection?
In this episode of ETF Spotlight, I speak with Matt Kaufman, Head of ETFs at Calamos, about Structured Protection ETFs, which allow investors to gain exposure to stock markets while protecting against downside risks.
The Calamos S&P 500 Structured Alt Protection ETF (CPSM - Free Report) aims to match the return of the SPDR S&P 500 ETF Trust (SPY - Free Report) up to a cap while promising 100% downside protection against the index’s losses over a one-year outcome period.
The Calamos Nasdaq-100 Structured Alt Protection ETF (CPNJ) provides protected exposure to the Nasdaq-100 index (QQQ - Free Report) . Calamos plans to roll out new ETFs every month.
Like other buffer ETFs, these products invest in a basket of FLEX options with varying strike prices. The strategy involves buying call options to gain index exposure and put options for downside protection, then offsetting the costs by selling call options, which caps upside returns.
Investors should remember that stocks tend to go up over the long term and that they should generally ignore short-term noise. Since its inception in January 1993, SPY has returned about 10.3% annualized. By seeking downside protection, investors forgo any potential upside beyond the cap.
At the same time, many risk-averse investors, particularly those in or nearing retirement, have been reluctant to buy stocks. There is a tremendous amount of cash sitting on the sidelines.
Some invest in products like fixed indexed annuities and market-linked CDs that protect against downside risks but come with much higher fees, high investment minimums, long lockup periods, and unfavorable tax treatment. Protection ETFs are a much better option for such investors.
The Innovator Equity Defined Protection ETF (TJUL - Free Report) , which provides 100% downside protection over a two-year outcome period, has gathered $220 million since launching in July last year.
Tune in to the podcast to learn more.
Make sure to be on the lookout for the next edition of the ETF Spotlight and remember to subscribe! If you have any comments or questions, please email podcast@zacks.com.