A new ETF made to defend traders from the hazard of current market volatility starts trading on Wednesday.
The Calamos S&P 500 Structured Alt Security ETF (CPSM) claims to provide buyers “100% draw back security” from the index’s losses more than a 1-12 months outcome period, according the firm’s news launch.
Calamos’ head of ETFs Matt Kaufman helped create the new merchandise.
“You will find no methods. You can find no magic,” he instructed CNBC’s “ETF Edge” on Monday. “This is the key sauce.”
Kaufman described the new ETF enters into a few options positions. Investors in the fund are matter to limits on the extent to which they can seize gains tied to the S&P 500.
“They all perform with each other. It truly is a thoroughly funded possibilities offer that provides the upside of the S&P 500 to a cap with 100% cash safety more than a 365-day outcome period,” he reported. “Then at the close of that calendar year, the alternatives reset, keep in the ETF and preserve on likely.”
The fund will have an annual expenditure ratio of .69%.
In order to get the comprehensive downside safety in opposition to losses in the S&P 500 that the fund promises, Kaufman noted investors must buy it Wednesday when it hits the industry.
“If you invest in in on working day a single, you get that 100% safety,” he said. “[But] even working day two [or] working day a few, you will find in all probability prospects to purchase in all alongside the way.”
The fund is just one of a suite of 12 structured security ETFs the organization options to launch around the course of the next calendar year. Impending money include these aiming to secure from losses tied to the Nasdaq 100 and Russell 2000 benchmarks.
