Innovator Debuts 2 International Buffer ETFs

Both the Innovator International Developed 10 Buffer ETF (IBUF) and Emerging Markets 10 Buffer ETF (EBUF) are actively managed funds. Each fund focuses on international investments.

IBUF aims to give investors similar returns to that of the iShares MSCI EAFE ETF (EFA A), up to a 3.38% cap. The fund’s capped upside comes along with a 10% downside buffer over the outcome period.

EFA allocates assets toward developed markets outside of North America, including Japan, Australia, and Western Europe. The fund remains a highly popular investment option for developed markets, with over $53 billion in AUM.

Focusing on emerging markets, EBUF strives to track the return of the iShares MSCI Emerging Markets ETF (EEM A-). Much like IBUF, the fund provides capped upside potential of 3.52%, along with a 10% buffer over the outcome period.

EEM provides access to mid- and large-cap assets in emerging markets. The countries that EEM is highly exposed to include China, Taiwan, South Korea, and India. The fund has over $19 billion in assets under management.

IBUF and EBUF both primarily invest in FLEX Options on their respective underlying ETFs. By using FLEX options, both funds can provide liquid and flexible investment exposure to international equities, with a defensive buffer cap to mitigate risk.

The outcome period for both funds concludes on a quarterly basis. At the conclusion of each outcome period, both IBUF and EBUF will invest in new FLEX Options with three-month expiration dates and begin the next outcome period.

These funds can be held indefinitely, as the conclusion of the current outcome period will naturally fold into the next period. However, upside caps for both funds may vary based on market conditions at the start of the outcome period.

Innovator currently has over 120 ETFs listed in the United States. As a whole, these funds have over $18 billion in assets under management.

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