Megaphone icon ETF Database is now VettaFi. Read More >
ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • Entrepreneur ETF
    • Equity ETF
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Future ETFs
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Modern Alpha
    • Multi-Asset
    • Multi-Factor
    • Nasdaq Investment Intelligence
    • Portfolio Strategies
    • Retirement Income
    • Smart Beta
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Videos & Podcasts
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Simplify Releases Two Innovative ETFs, PFIX & SVOL
News
Share

Simplify Releases Two Innovative ETFs, PFIX & SVOL

Aaron NeuwirthMay 13, 2021
2021-05-13

On Thursday, Simplify Asset Management, an innovative provider of options-based ETFs, announced the launch of two first-of-their-kind ETFs: the Simplify Interest Rate Hedge ETF (PFIX) and the Simplify Volatility Premium ETF (SVOL). PFIX provides direct and transparent convex exposure to an upward shift in long-dated rates; SVOL is the first-ever VIX income strategy with an option hedge.

PFIX, which listed on Tuesday, May 11th, seeks to provide a hedge against a sharp increase in long-term interest rates. Using over-the-counter derivatives, typically only available to institutional investors, PFIX provides direct and transparent convex exposure to an upward shift in long-dated rates.

At launch, PFIX invests 50% of its NAV into a long-dated option on long-term interest rates. By carefully selecting option strike, time to expiry, and the underlying rate maturity, PFIX attempts to create a low-cost, powerful, and highly convex position.

“Portfolios today are too often overexposed to interest rate risk and the impacts from a reemergence of inflation, but hedging portfolios against these risks has long been challenging as traditional hedges, like futures, come with large costs of carry, while more sophisticated approaches, like interest rate derivatives, have only been available to institutional investors,” said Harley Bassman, Managing Partner with Simplify. “With PFIX, investors now have a tool that can be used as an explicit hedge against rising rates for all the parts of a portfolio that tend to struggle in a rising rate environment, including high quality long-dated fixed income, real estate, and growth equities.”

Additionally, SVOL, which begins trading today, is designed to capture the volatility premium stemming from imbalanced hedge demand while simultaneously buying call options on the VIX as a means of hedging against adverse spikes in equity market volatility. The fund invests in a short volatility strategy designed to generate substantial income while minimizing volatility drag. It then spends a modest budget on VIX call options that seek to mitigate the short volatility portfolio when the VIX spikes. It is the first-ever VIX income strategy with an option hedge.

“Investors searching for income in today’s market have to navigate the twin challenges of historically low bond yields and highly volatile equity markets. These market conditions do, however, make the volatility risk premium an interesting potential source of income; one made all the more appealing with the approach captured in SVOL which strives to reduce the risk of substantial tail events,” said Michael Green, CFA, Portfolio Manager & Chief Strategist with Simplify. “We’re very excited to be bringing this first-of-its-kind strategy to market and see SVOL as a key solution for investors looking for alternatives to the usual high yield approaches, diversifiers for traditional asset classes, and as a tactical vehicle for those times when volatility levels are most attractive.”

PFIX and SVOL join a Simplify ETF family that has quickly surpassed the $250 million asset mark since the launch of its initial offerings in late 2020, as advisors, family offices, institutions, and the retail investor community have been drawn to the more scientific approach the firm has pioneered in combining equity index exposures with robust options overlays.

“We could not be more excited to be adding PFIX and SVOL to our fund family, and look forward to the conversations that our leadership team, with its unsurpassed background in options, portfolio construction, convexity, and more, will be having with advisors in the weeks and months to come,” added Paul Kim, CEO and Co-Founder of Simplify. “ETFs are a great democratizer, and we’re thrilled to be making the sophisticated strategies underpinning both of these new funds available to the marketplace.”

For more information, visit www.simplify.us.

This article originally appeared on ETFTrends.com.


Content continues below advertisement

» Popular Pages

  • Tickers
  • Articles

Jun 24

As Inflation Rises, Try Equal Weighting Equity Holdings

Jun 24

Cybersecurity Investments Could be an Opportunity

Jun 24

Diversifying During Rate Hikes With a Real Estate ETF

Jun 24

Don't Ever Bet Against the S&P 500

Jun 24

Have We Reached Rock Bottom?

Jun 24

Coinbase Poised to Launch Derivatives Product

Jun 24

Any Time is the Right Time to Begin Investing

Jun 24

American Century’s Sandra Testani

Jun 24

Exxon Demands Higher Carbon Tax: This Fund Benefits

Jun 24

Gender Matters When it Comes to Retirement Planning

QQQ

Invesco QQQ Trust

SPY

SPDR S&P 500 ETF Trust

VOO

Vanguard S&P 500 ETF

ARKK

ARK Innovation ETF

VTI

Vanguard Total Stock Market...

XLE

Energy Select Sector SPDR...

VYM

Vanguard High Dividend Yield...

IVV

iShares Core S&P 500 ETF

SCHD

Schwab US Dividend Equity ETF...

XLK

Technology Select Sector SPDR...


Content continues below advertisement

Loading Articles...
Help & Info
  • Contact Us
  • Mission Statement
  • Press
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © ETF Flows LLC
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X