ETF Spotlight: September 2012

Published on by on September 4, 2012

Each month, we highlight an ETF flying under the radar of most investors that offers exposure to a unique asset class or investment strategy. This month, we take a closer look at a new offering from First Trust which combines core equity exposure with a built-in defense mechanism. The CBOE S&P 500 VIX Tail Hedge Fund (VIXH) offers investors a way to tap into one of the most popular stock market benchmarks in the world with a twist.

Although the global economic backdrop remains clouded with uncertainty, it’s undeniable that investors’ confidence has slowly been recovering in recent months. What better confirmation than price action in the stock market itself; amid all of the looming threats from Europe and worries of a slower-than-expected recovery at home, the S&P 500 Index inched over 2% higher in August and remains in double-digit gains territory for the year. The benchmark has been flirting with historical resistance levels over the past few weeks as sparse economic data releases have failed to provide much of a fundamental catalyst in either direction. Investors eager to jump aboard the bull train at current levels should take a closer look at VIXH as it offers a creative way to defend against steep sell-offs. 

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