For many advisors and investors, bonds traditionally serve as capital preservation instruments to strengthen portfolios during market volatility. So, what are the implications if bonds no longer function as a reliable risk-mitigation asset class?
When instability and tariff threats became the foreground of market discourse, many traders opted to pivot exposure to bonds. However, even bonds have now seen significant price plunges, with the 10-year Treasury yield recently striking a seven-week high.
These economic conditions have prompted advisors and investors to reassess the consistency of bonds during market uncertainty. As such, demand may be on the rise for bond alternatives.
The Calamos suite of Structured Protection ETFs has cemented itself as a compelling alternative to fixed income exposure. Much like fixed income, these funds can help cultivate a hedge against risk in the broader market. However, they do so while offering equity exposure through a disciplined options strategy.
Employ Protected Equities as a Fixed Income Alternative
One Calamos fund that may be particularly worth consideration is the Calamos Laddered S&P 500 Structured Alt Protection ETF (CPSL). This fund offers both security and equity returns through a laddered portfolio of monthly Calamos S&P 500 Structured Protection ETFs.
Each of the underlying ETFs will give investors access to S&P 500 upside, up to a predetermined cap. Crucially, this S&P 500 exposure is paired with a significant overlay of downside security. Each fund, across its one-year outcome period, protects against 100% of potential losses, aside from fees and expenses.
CPSL’s objective is to offer relatively even exposure to each of these S&P 500 Structured Protection ETFs. Thus, investing in the fund can create rolling exposure that captures a mix of different market periods.
This rolling support is part of how Calamos Structured Protection ETFs can operate as a bond alternative. Much like U.S. Treasuries, these funds can be used as a long-term portfolio fixture to hedge against equity market risk.
The Calamos suite of Structured Protection ETFs is ever-growing, with new funds launching on a regular basis. For more information, visit the Calamos Structured Protection ETF webpage.
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