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Derivative ETFs surge as advisors seek income without rate and duration risk
Total assets in the derivative ETF category grew from about $7.0 billion in 2020 to more than $214.0 billion today.
ETF Trends reports that the derivative ETF landscape is rapidly expanding as financial advisors seek ways to generate elevated, tax-efficient income while navigating equity market volatility without taking traditional interest-rate or duration risk.
According to the outlet, a TMX VettaFi webcast featuring analysts and investment professionals discussed how options and covered call strategies have become a key part of that shift.
The article says assets in the derivative ETF category rose from approximately $7.0 billion in 2020 to more than $214.0 billion today, an increase of roughly 30-fold.
ETF Trends also cited research indicating that of about 1,000 U.S. ETF launches year-to-date, roughly half incorporate derivatives, with covered call strategies representing the largest segment of derivative utilization.