As Recession Risk Looms, Time To Buffer Market Exposure
Fears that the Federal Reserve's overly aggressive monetary policy tightening could trigger a recession, remain an overhang for the market outlook for the rest of 2022. Nevertheless, there are still ways to manage potential risks and keep clients invested.
In this upcoming webcast, join Innovator ETFs and VettaFi for a discussion highlighting the benefits of the Innovator Buffer ETF™ strategy in the current market turbulence, especially how Defined Outcome ETFs™ can help clients stay fully invested in the market up to a cap, with built-in buffers against equity downside.
Lara Crigger, Editor-in-Chief of VettaFi, will moderate a discussion on:
- Outlook for the rest of 2022 – what risks lie on the horizon?
- How the Buffer ETF™ strategy can help clients maintain upside exposure while hedging downside risks
- How to incorporate Defined Outcome ETFs™ into a diversified portfolio to better manage risk
Accepted for one hour of CFP/CIMA CE credit for live and on-demand attendees
CFA Institute members are encouraged to self-document their continuing professional development activities in their online CE tracker.
Graham DayVice President of Product and Research
John Southard, CFACo-Founder & CIO
For financial professional use only.
If the Outcome Period has begun and the Fund has experienced a positive return, an investor purchasing shares may be subject to losses that exceed any losses of the Underlying ETF for the remainder of the Outcome Period and may have diminished or no ability to experience further Accelerated Return, therefore exposing the investor to greater downside risks.
The funds only seek to provide their investment objective, which is not guaranteed, over the course of an entire outcome period. Investors who purchase shares after or sell shares before the end of an outcome period will experience very different outcomes than the funds seek to provide.
The Funds are designed to provide point-to-point exposure to the price return of a reference asset via a basket of Flex Options. As a result, the ETFs are not expected to move directly in line with the reference asset during the interim period. Additionally, FLEX Options may be less liquid than standard options. In a less liquid market for the FLEX Options, the Fund may have difficulty closing out certain FLEX Options positions at desired times and prices.
Fund shareholders are subject to an upside return cap (the Cap) that represents the maximum percentage return an investor can achieve from an investment in the funds’ for the Outcome Period, before fees and expenses. If the Outcome Period has begun and the Fund has increased in value to a level near to the Cap, an investor purchasing at that price has little or no ability to achieve gains but remains vulnerable to downside risks. Additionally, the Cap may rise or fall from one Outcome Period to the next. The Cap, and the Fund’s position relative to it, should be considered before investing in the Fund. The Funds’ website, www.innovatoretfs.com, provides important Fund information as well information relating to the potential outcomes of an investment in a Fund on a daily basis.
The Funds only seek to provide shareholders that hold shares for the entire Outcome Period with their respective buffer level against reference asset losses during the Outcome Period. With XBJL, you will bear all reference asset losses exceeding 9%. Depending upon market conditions at the time of purchase, a shareholder that purchases shares after the Outcome Period has begun may also lose their entire investment. For instance, if the Outcome Period has begun and the Fund has decreased in value beyond the pre-determined buffer, an investor purchasing shares at that price may not benefit from the buffer. Similarly, if the Outcome Period has begun and the Fund has increased in value, an investor purchasing shares at that price may not benefit from the buffer until the Fund’s value has decreased to its value at the commencement of the Outcome Period.
The Funds’ investment objectives, risks, charges and expenses should be considered carefully before investing. The prospectus contains this and other important information, and it may be obtained at innovatoretfs.com. Read it carefully before investing.
Innovator ETFs are distributed by Foreside Fund Services, LLC.