Nationwide Risk-Managed Income ETF NUSI

Overview

The fund is designed as an actively-managed exchange-traded fund (ETF) that primarily aims to meet its investment goal by holding a combination of stocks from the Nasdaq-100® Index and engaging in an options strategy known as a collar. This particular strategy involves the simultaneous use of put options (which the fund buys) and call options (which the fund sells) on the Nasdaq-100 Index. The objective is to hedge against market volatility and potential losses, which could make this ETF an attractive option for investors looking for some level of protection in turbulent market conditions. Predominantly, the fund commits at least 80% of its net assets, in addition to any borrowings for investment purposes, to securities or derivatives that are tied to the companies listed within the Nasdaq-100 Index. It is important to note that the fund is classified as non-diverse, indicating a focused investment strategy that targets specific securities within a narrow market segment.

Products and Services

Stocks from the Nasdaq-100® Index: The crucial component of the fund’s investment strategy involves holding stocks from the Nasdaq-100 Index. This index is renowned for encompassing 100 of the largest non-financial companies listed on the Nasdaq stock market, based on market capitalization. The emphasis on these stocks allows the fund to potentially benefit from the growth and performance of some of the leading technology and biotech companies, among others, in the U.S. market.

Options Collar Strategy: By adopting an options collar strategy, the fund secures its position through buying put options and selling call options on the Nasdaq-100 Index. This tactic serves two main purposes: it provides a safety net against significant declines in the index and limits the fund’s upside potential in exchange for this protection. The written call options cap the profit potential if the index rises beyond a certain point, while the bought put options protect against drastic drops by enabling the fund to sell its holdings at a predetermined price. This balanced approach aims to mitigate risks associated with market volatility, making it a noteworthy feature for risk-averse investors.