The latest funds from Allianz Investment Management provide laddered portfolios of the company’s own Buffer ETFs.
As buffer ETFs, both of these AllianzIM funds seek to offer capital appreciation with an added bulwark of downside mitigation. Following a fee waiver, these funds each have net expense ratios of 79 basis points.
The first of the new AllianzIM funds is the AllianzIM 6 Month Buffer10 Allocation ETF. The fund invests in a laddered portfolio of six AllianzIM U.S. Large Cap 6 Month Buffer10 ETFs.
Much like SPBX, the AllianzIM Buffer 20 Allocation ETF invests in a laddered portfolio of AllianzIM ETFs. Within SPBW’s portfolio is a laddered selection of a dozen AllianzIM U.S. Large Cap Buffer20 ETFs.
SPBX’s and SPBW’s underlying ETFs offer capped upside to the price returns of the SPDR S&P 500 ETF Trust (SPY ). For these underlying funds, potential returns from SPY are subject to an upside cap.
However, this capped upside is paired with a buffer on potential losses SPY may incur. SPBX’s underlying ETFs offer a buffer of 10% of losses, while SPBW’s portfolio constituents provide a 20% downside hedge.
These buffered strategies operate under different outcome periods. SPBX’s laddered ETFs have outcome periods of six months. Meanwhile, the funds in SPBW’s portfolio have outcome periods that last for one year.
Advantages of Laddered ETFs
Investing in a laddered portfolio can mitigate much of the timing risk that traditionally comes from buffered ETFs. Since laddered funds provide continuous coverage to these buffered ETFs, investors don’t need to worry as much about perfectly timing their investment.
“Our Buffer Allocation ETFs reflect AllianzIM’s commitment to providing innovative risk management tools that empower investors to navigate unpredictable markets with confidence,” noted Chris Chambs, CEO of AllianzIM. “Delivering buffered protection in a single-ticker format marks a significant advancement in our mission to offer adaptive, risk-managed solutions that seek to meet the evolving needs of today’s investors.”
By choosing to invest in SPBX or SPBW, investors get to tap into AllianzIM’s extensive experience in piloting buffered strategies. Many of these AllianzIM funds continue to see strong fund flows from the investment community.
For instance, the AllianzIM U.S. Large Cap Buffer20 Jan ETF (JANW ) has over $400 million in assets under management. These terrific AUM numbers come after the fund saw well over $200 million in net flows in the last month, as of January 6, 2025.
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