One of the primary advantages of the Nationwide Risk-Managed Income ETF (NUSI) is that the ETF uses a unique approach to generating steady, lower-risk retirement income for investors.
The Nationwide Risk-Managed Income ETF incorporates options exposure to help generate income and mitigate risk as a way to enhance total returns. Investors have long capitalized on covered call options strategies for income generation or protective put options strategies to protect against and limit losses.
“Today’s market swings have once again reminded us that such uncertainty can have an amplified effect on a specific demographic: pre-retirees,” reports Benefits Pro. “Understandably, those nearing retirement are especially fearful of losing their hard-earned nest egg, which can often cause considerations for making changes to one’s investment allocations — without considering the long-term view.”
Dual NUSI Benefits
NUSI incorporates both covered call and protective puts as a way to enhance income generation and protect against any potential downside.
A covered call refers to an options strategy where an investor writes or sells a call option on an asset which they already own or bought on a share-for-share basis to generate income via premiums derived from the sale of the call options. However, the covered call strategy caps upside potential and provides limited downside protection, so it is ideal for investors with a neutral-to-bullish outlook.
NUSI is also a vital consideration for bond investors. Fixed-income investors who are struggling with yield generation in a low-rate environment should take a look at a new risk-managed income exchange traded fund strategy that could generate improved yields relative to traditional income-focused investments.
NUSI can act as a complement to traditional equity and fixed income allocations or as the ideal protective hedge for investors with heavy exposure to technology and growth stocks because the fund is a “rules-based options trading strategy that seeks to produce high income using the Nasdaq-100 Index,” according to Nationwide.