Allianz Investment Management LLC (AllianzIM), a wholly owned subsidiary of Allianz Life Insurance Company of North America has launched a new buffered outcome ETF with a six-month outcome period: the AllianzIM U.S. Large Cap 6 Month Buffer10 Apr/Oct ETF (NYSE: SIXO).
AllianzIM’s new ETF seeks to match the returns of the S&P 500 Price Return Index up to a stated Cap, while providing downside risk mitigation through a Buffer against the first 10 per cent of S&P 500 Price Return Index losses for SIXO over a six-month outcome period. SIXO seeks to meet its investment objective using flexible exchange (FLEX) options.
“The buffered outcome ETF market has grown dramatically, increasing from zero to almost $8 billion of assets in just three years,” says Johan Grahn, Vice President and Head of ETF Strategy at AllianzIM. “We’re excited to expand our lineup of Buffered Outcome ETFs to meet the evolving risk management needs of investors. SIXO is the latest addition to our Defined Outcome ETF lineup, providing investors with an opportunity to participate in the equity market up to a cap in an ETF that provides a 10 per cent buffer against losses and the potential for gains to be realized every six months.”
SIXO debuts as one of the lowest-cost buffered outcome ETFs on the market with an expense ratio of 0.74 per cent. The ETF is designed to create more opportunity for investors with two outcome periods per year, as well as provide additional applications within an investment portfolio. SIXO provides the potential for greater downside mitigation with a 10 per cent buffer over a shorter period and can serve as a potential alternative to short-term, low-yielding investment vehicles.
The six-month outcome ETF joins the existing suite of AllianzIM Buffered Outcome ETFs with a 10 per cent and 20 per cent buffer, which offer a one-year outcome period. The AllianzIM U.S. Large Cap Buffer10 Oct ETF (NYSE: AZAO) and the AllianzIM U.S. Large Cap Buffer20 Oct ETF (NYSE: AZBO) today begin a new one-year outcome period with new upside caps.
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