New ETF Balances S&P 500 Exposure With Treasury Stability To Limit Losses

Investors looking for a strategic way to engage with the market while managing risk now have a new option. Measured Risk Portfolios (MRP) has launched the MRP SynthEquity ETF (NYSE:SNTH), an actively managed exchange-traded fund designed for long-term capital appreciation.

To enhance stability, the fund follows a quarterly laddered approach to its U.S. Treasury investments. The strategy primarily includes high-yielding Treasuries that mature around the 15th of March, June, September, and December, maintaining an overall portfolio duration of about six months.

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This strategic blend of options exposure and Treasuries is intended to provide a safeguard against downside risk, with an aim to cap potential losses at approximately 15% over any rolling one-year period.

The fund carries a net expense ratio of 95 basis points.

SNTH employs a two-pronged investment strategy to balance market participation with risk management.

The first component involves investing in options contracts on the S&P 500 Index. By using standardized exchange-traded or FLEX options, the fund aims to generate returns through synthetic long exposure.

Complementing this options strategy, SNTH maintains a U.S. Treasury portfolio. This portfolio plays a dual role: mitigating risk and generating income.

For investors who are cautious about market uncertainties, SNTH offers a compelling solution. By staying engaged with the S&P 500 while cushioning against volatility, the fund presents an attractive option for those seeking growth with risk mitigation.

Additionally, as an actively managed ETF, SNTH is positioned to respond to macroeconomic shifts more effectively than passive strategies. This dynamic management approach may provide an edge in navigating changing market conditions.

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