A brand new ETF designed to defend buyers from the chance of market volatility begins buying and selling on Wednesday.
The Calamos S&P 500 Structured Alt Protection ETF (CPSM) guarantees to ship buyers “100% downside protection” in opposition to the index’s losses over a one-year consequence interval, in accordance the agency’s information launch.
Calamos’ head of ETFs Matt Kaufman helped construct the brand new product.
“There’s no tricks. There’s no magic,” he advised CNBC’s “ETF Edge” on Monday. “This is the secret sauce.”
Kaufman defined the brand new ETF enters into three choices positions. Investors within the fund are topic to limits on the extent to which they will seize beneficial properties tied to the S&P 500.
“They all work together. It’s a fully funded options package that delivers the upside of the S&P 500 to a cap with 100% capital protection over a 365-day outcome period,” he mentioned. “Then at the end of that year, the options reset, stay in the ETF and keep on going.”
The fund could have an annual expense ratio of 0.69%.
In order to obtain the total draw back safety in opposition to losses within the S&P 500 that the fund guarantees, Kaufman famous buyers should purchase it Wednesday when it hits the market.
“If you buy in on day one, you get that 100% protection,” he mentioned. “[But] even day two [or] day three, there’s probably opportunities to buy in all along the way.”
The fund is only one of a collection of 12 structured safety ETFs the agency plans to launch over the course of the subsequent yr. Upcoming funds embody these aiming to guard in opposition to losses tied to the Nasdaq 100 and Russell 2000 benchmarks.
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https://www.cnbc.com/2024/04/30/new-calamos-etf-promises-100percent-downside-protection-how-it-works.html
