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2020 Year in Review & Lessons Learned – Glad That’s Over… But is It?

In March, when markets crashed due to the coronavirus pandemic and swirling uncertainty that ensued, nobody was prepared. Although the markets swiftly rebounded and ended the year with one of the strongest finishes in history, many investors had received a sharp lesson in the value of being prepared for the worst.

The stock market is clearly not in sync with all of the struggles the U.S. is facing in the real world. However, investors can adequately prepare their portfolios for the unexpected while simultaneously seeking to participate in future market gains.

At Swan, we believe our hedged equity approach, the Defined Risk Strategy, is well-positioned to help investors mitigate risk and potentially preserve assets should the markets sell off again. By staying always invested in low-cost ETFs, our Defined Risk Strategy seeks to generate consistent long-term rolling returns while also limiting risk during major market downturns by remaining always hedged using long-term put options.

Portfolio diversification is a good first step, but products like Swan’s first-ever Hedged Equity ETF go a step further by applying an active investment approach with the goal of providing a smoother ride.

The strange, devastating and unpredictable year that was 2020 may finally be past us, but there are still many challenges that lie ahead. Millions of Americans remain unemployed, the economy is not yet back on track and the country is still suffering through the worst of the COVID-19 pandemic.

As the U.S. looks to forge a new path ahead in 2021, investors would be wise to learn from the trials and tribulations of 2020 and prepare accordingly.

Important Notes and Disclosures:

Swan Global Investments, LLC is a SEC registered Investment Advisor that specializes in managing money using the proprietary Defined Risk Strategy (“DRS”). SEC registration does not denote any special training or qualification conferred by the SEC. Swan offers and manages the DRS for investors including individuals, institutions and other investment advisor firms.

All Swan products utilize the Defined Risk Strategy (“DRS”), but may vary by asset class, regulatory offering type, etc. Accordingly, all Swan DRS product offerings will have different performance results due to offering differences and comparing results among the Swan products and composites may be of limited use. All data used herein; including the statistical information, verification and performance reports are available upon request. The S&P 500 Index is a market cap-weighted index of 500 widely held stocks often used as a proxy for the overall U.S. equity market. Indexes are unmanaged and have no fees or expenses. An investment cannot be made directly in an index. Swan’s investments may consist of securities that vary significantly from those in the benchmark indexes listed above and performance calculation methods may not be entirely comparable. Accordingly, comparing results shown to those of such indexes may be of limited use. The adviser’s dependence on its DRS process and judgments about the attractiveness, value and potential appreciation of particular ETFs and options in which the adviser invests or writes may prove to be incorrect and may not produce the desired results. There is no guarantee any investment or the DRS will meet its objectives. All investments involve the risk of potential investment losses as well as the potential for investment gains. Prior performance is not a guarantee of future results and there can be no assurance, and investors should not assume, that future performance will be comparable to past performance. All investment strategies have the potential for profit or loss. Further information is available upon request by contacting the company directly at 970-382-8901 or swanglobalinvestments.com. 038-SGI-020121

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