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ACIO's unique strategy of combining a core stock basket, covered calls, and put options provides robust downside protection, making it a standout ETF. Transparency in ACIO's holdings and strategy contrasts sharply with JEPI's opaque equity-linked notes, enhancing investor confidence in understanding risk. But I don't own ACIO because my own self-driven active investment process is similar enough in some aspects that make owning it redundant for me.
The Fed just kicked off its long-awaited rate cutting cycle in September. What are the best ETFs for this environment?
The Aptus Collared Investment Opportunity ETF is a hedged equity ETF. It aims to mimic the S&P 500 but with fewer stocks. ACIO employs a strategy of writing call options and buying put spreads to manage risk. The fund seeks to capture 65% of the S&P 500's upside while limiting downside to 50%.
The Aptus Collared Investment Opportunity ETF combines large-cap stock exposure, covered calls for income, and protective puts to hedge against major market drops. ACIO's active management strategy allows it to control risks and generate extra income, distinguishing it from passive index funds and other growth-focused ETFs. The fund's protective puts provide a safety net during market downturns, appealing to cautious investors seeking both growth potential and downside protection.
The Aptus Collared Investment Opportunity ETF is a liquid ETF with $1.14 billion AUM, offering downside protection ideal for fixed income investors. ACIO employs a collared strategy by selling calls on individual holdings and buying puts on a basket of equities, enhancing net credit. The ETF has underperformed the broader market but offers downside risk protection, making it a reasonable Buy for investors seeking stability in a volatile economy.
A recent ETF launch serves as an indicator of a new trend related to options trading. On Sept. 14, thematic ETF provider Defiance ETFs launched The Defiance Nasdaq-100 Enhanced Option ETF (NASDAQ: QQQY ).
investors are looking for investments that provide capital appreciation opportunities in the equity world but at the same time offer downside protection. A lucrative option for now could be the Buy-Write strategy.
A buy-write, also known as a covered call strategy, is an investment strategy used to generate income and potentially hedge against downside risk.
FAQ
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