NEW YORK–(COMMERCIAL THREAD) – Simplify Asset Management (“Simplify”), an innovative provider of option-based exchange-traded funds (“ETFs”), today announced the launch of its latest ETF: the Simplify Tail Risk Strategy ETF (CYA ).
CYA seeks to provide investors with a stand-alone solution to hedge against massive sell-offs in the stock markets. The fund deploys an advanced option overlay designed to handle multiple types of market disruptions and is structured so that modest allocations to the fund can provide a total portfolio hedging solution.
“Bond yields remain close to their historic lows, prompting more investors to look to equities for growth and income. But with so much uncertainty in the markets, it can be extremely difficult for investors and advisers to stay the course in equity-dominated portfolios. That’s where CYA comes in, ”said Paul Kim, CEO of Simplify. “We have designed the fund in such a way that a modest exposure can potentially provide significant hedge against large losses, those extreme risks that can have such a negative impact on a portfolio and the fear of which can lead investors to proceed. a portfolio allocation. faux pas.
CYA invests between 10 and 15% per annum in a sophisticated options strategy designed to create a very convex return when the markets are falling significantly. The remainder of the fund is invested in high income strategies to help finance option purchases.
“The more the market moves down, the greater the potential benefits of the CYA approach can be,” Kim added. “This is why our option overlay is referred to as ‘convex’ because there is a strong distinction between this approach and more linear equity hedging strategies. ”
CYA joins a family of Simplify ETFs which, in just over a year, have already reached around $ 700 million. with sturdy option overlays. More recently, the company has also introduced a number of innovative ETF solutions designed around interest rate hedging (PFIX), volatility income (SVOL), and equity and bitcoin exposure, via GBTC (SPBC).
ABOUT SIMPLIFY ASSET MANAGEMENT INC
Simplify Asset Management Inc. is a registered investment advisor founded in 2020 to help advisors tackle the most pressing portfolio challenges with an innovative set of option-based strategies. Taking into account the real needs of investors and market behavior, as well as the non-linear power of options, our strategies deliver the tailored portfolio results clients are looking for. For more information, visit www.simplify.us.
Investors should carefully consider the investment objectives, risks, fees and expenses of exchange traded funds (ETFs) before investing. To obtain an ETF prospectus containing this and other important information, please call (855) 772-8488 or visit SimplifyETFs.com. Please read the prospectus carefully before investing. Investing in the fund involves risks, including possible loss of capital. Past performance is no guarantee of future results.
Investing in the fund involves risks, including the possible loss of capital.
The fund seeks to generate income and capital appreciation while protecting against significant downside risk. The fund is new and has a limited operating history.
The Fund invests in ETFs (Exchange Traded Funds) and is therefore subject to the same risks as the underlying securities in which the ETF invests and incurs higher expenses than if it were invested directly in the underlying ETF. .
The Fund is subject to the risk that the investment management strategy will not produce the expected results and may have a negative impact on the performance of the Fund. The advisor’s stacking strategy will not fully protect the Fund against market downturns.
The risks of the Fund include, but are not limited to: credit default swaps – involve different investment techniques and risks than those associated with ordinary portfolio securities transactions, such as counterparty, concentration and risk risks. potentially increased exposure, geopolitical risk – the occurrence of global events similar to those in recent years may result in market volatility and may have long-term effects in US and global financial markets, and real estate risks may change in response to changes in the real estate market such as declines in real estate values, lack of available capital or financing opportunities, and increases in property taxes or operating costs.
While the option overlay is intended to improve the performance of the Fund, there can be no assurance that it will. The use of an option overlay strategy involves the risk that as a buyer of a put or call option, the Fund risks losing the entire premium invested in the option if the Fund does not exercise the option. In addition, securities and options traded in over-the-counter markets may be traded less frequently and in limited volumes and thus present a higher volatility and liquidity risk.
Risk associated with futures contracts: Futures contracts involve the following risks (a) imperfect correlation between the change in the market value of the instruments held by the Fund and the price of the futures or futures contract; (b) the possible absence of a liquid secondary market; (c) leverage, which means that a low percentage of assets in futures contracts may have a disproportionate impact on the Fund and the Fund may lose more than the capital invested; (d) losses are potentially unlimited; (f) the possibility that the counterparty will default in the performance of its obligations.
Simplify ETFs are distributed by Foreside Financial Services, LLC.