· Global X MSCI China Consumer Staples ETF (CHIS)
· Global X MSCI China Health Care ETF (CHIH)
· Global X MSCI China Information Technology ETF (CHIK)
· Global X MSCI China Real Estate ETF (CHIR)
· Global X MSCI China Utilities ETF (CHIU)
An ETF For Black Swan Events
Last quarter’s stock market volatility rattled investors and likely prompted lots of serious thought about downside protection. In what perhaps is a case of fortuitous timing, Amplify ETFs in November introduced the Amplify BlackSwan Growth & Treasury Core ETF (SWAN), which tracks an index designed to provide upside exposure to the S&P 500 while offering a bond-heavy portfolio to protect investors against sharp equity downturns.
Roughly 90% of the fund will allocate to U.S. Treasurys ranging from two- to 30-year durations, which cumulatively provide a portfolio duration akin to 10-year Treasury notes. Duration measures a bond’s sensitivity to changes in interest rates, and the 10-year note was chosen on the premise that returns on intermediate-term U.S. Treasury securities tend to have low correlations with U.S. equities.
The remaining 10% or so of the underlying S-Network BlackSwan Core Total Return Index will comprise LEAP options on the SPDR S&P 500 ETF (SPY) in the form of in-the-money calls, which are options contracts with a strike price below the current price of the targeted asset. The options provide leveraged exposure to equities, and will generally have a delta of 70 at the time of purchase, meaning that each LEAP option will have a corresponding movement of 70 cents for every $1.00 of movement in the share price of SPY. In other words, the fund strives to capture 70% of the upside experienced by the SPY fund over a full market cycle.
The index reconstitutes and rebalances every June and December, and its expense ratio is 0.49%.