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Can These ETFs Help Reduce the Risk in Your Portfolio?

Neena Mishra
·3 mins read
  • (2:00) - What Can Investors Expect From The Increased Volatility?

  • (8:35) - Protecting Your Portfolio: What Are The Biggest Risks To The Stock Market?

  • (17:15) - Cabana Asset Management: Target Drawdown Series

  • (26:00) - How Do These Funds Fit Into An Investor's Portfolio?

  • (29:10) - Market Expectations: Will The Stock Market Rally Continue Into 2021?

  • (33:40) - What Are The Challenges For Long Term Investors?

  • (36:50) - TrueMark Investments: Structured Outcome Series

  • (46:25) - Episode Roundup: Podcast@Zacks.com

In this episode of ETF Spotlight, we discuss how investors can prepare for an uncertain fourth quarter. September was a volatile month for markets and even though stocks have rallied in the final days, investors remain wary of heightened uncertainty before the November presidential election and the possibility of a contested election. Further, we are in the midst of a global pandemic and economic recovery remains uneven.

There are many reasons to remain positive on stocks no matter who wins the election. We'll likely have a V-shaped economic recovery when there are effective coronavirus vaccines available for general population. Further, we still have unprecedented monetary support by the Fed and trillions of dollars of cash on the sidelines, waiting to be invested.

Many investors are revisiting the risks in their portfolios. What can investors do now to be ready?  We also take a look at some products that offer built-in protection against market losses. 

In the first part, I speak with Chadd Mason, CEO of Cabana Group, a financial services firm that provides risk-based financial planning tools. Cabana recently launched five target drawdown ETFs that came to market with more than $1 billion in initial assets as its existing clients in separately managed accounts chose to switch to ETF format.

Cabana Target Drawdown ETFs--TDSA, TDSB, TDSC, TDSD and TDSE— aim to limit peak-to-trough declines from 5% to 16%. These are actively managed, fund of funds, that have expense ratios of about 0.68%. Per Chadd, investors need to stay invested but avoid large losses in order to be successful.

In the second part, my guest is Michael Loukas, CEO of TrueMark Investments, which offers a suite of structured outcome ETFs. The TrueShares Structured Outcome ETF Series—JULZ, AUGZ, SEPZ and OCTZ—use options on the S&P 500 Price Index and the SPDR S&P 500 ETF SPY to achieve their target outcomes. How are these products different from other buffer ETFs?

Tune into the podcast to learn more. Make sure to be on the lookout for the next edition of ETF Spotlight! If you have any comments or questions, please email podcast@zacks.com.

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SPDR SP 500 ETF (SPY): ETF Research Reports
 
CABTGT DD5 (TDSA): ETF Research Reports
 
CABTGT DD7 (TDSB): ETF Research Reports
 
CABTGT DD10 (TDSC): ETF Research Reports
 
CABTGT DD13 (TDSD): ETF Research Reports
 
CABTGT DD16 (TDSE): ETF Research Reports
 
TrueShares Structured Outcome July ETF (JULZ): ETF Research Reports
 
TrueShares Structured Outcome August ETF (AUGZ): ETF Research Reports
 
TrueShares Structured Outcome September ETF (SEPZ): ETF Research Reports
 
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Zacks Investment Research