On Tuesday, Simplify Asset Management added two new active funds with a focus on income.
Gaining Gold Exposure
The first fund, the Simplify Gold Strategy PLUS Income ETF (YGLD), offers an alternative take to gold investing. It has a net expense ratio of 0.50%.
YGLD aims to provide income and capital gains through 150% leveraged exposure to gold. The fund achieves this through the use of futures contracts.
Additionally, the fund features an options overlay that can help bolster monthly income. This overlay sells short-term put spreads on a variety of ETFs or indexes.
Given the potential risks of inflation next year, bolstering one’s exposure to gold can help mitigate some of that volatility. As such, this fund can serve as a single-ticker solution for mitigating volatility while building monthly income.
A Small-Cap Strategy
Meanwhile, the Simplify US Small Cap PLUS Income ETF (SCY) focuses on small-caps. Its net expense ratio currently sits at 55 basis points.
This fund aims to provide 100% exposure to U.S. small-caps through investment in small-cap ETFs. Given the ongoing rate-cutting cycle from the Fed, it can be helpful to build up small-cap exposure heading into the new year.
Much like YGLD, SCY offers an options overlay to build up monthly income. However, SCY’s options strategy is not subject to a cap on upside gains, unlike many other small-cap ETFs on the market.
“At Simplify, one of our core missions is designing tools that allow investors and advisors to build the most capital efficient portfolios possible, and it’s precisely that thinking that drove the creation of YGLD and SCY,” said David Berns, chief investment officer and Co-Founder of Simplify. “Both gold and small-cap equities have a role to play in a diversified portfolio and now, through these new ETFs, they can play that role while simultaneously providing an enhanced income stream. We’re very excited to be bringing these funds to market at a time when the search for enhanced yield has perhaps never been more front and center.”
Simplify currently offers more than 30 ETFs listed in the U.S. These funds represent over $6 billion in assets under management.
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