This unique strategy uses options to participate in market gains, plus hold - to - maturity corporate high - yield fixed income
ETFs as a buffer to help protect against downside risk.
Latin American countries with less of a
buffer against a global downturn, such
as Mexico and Brazil, have also been a drag on exchange traded fund (
ETF) flows.
By contrast, high - quality bonds such
as those found in investment - grade corporate funds like the iShares 1 - 3 Year Credit Bond
ETF (CSJ A-89) and the iShares iBoxx $ Investment Grade Corporate Bond
ETF (LQD A-66), etc.), or in Treasury portfolios such
as the iShares 1 - 3 Year Treasury Bond
ETF (SHY A-97) or the iShares 10 - 20 Year Treasury Bond
ETF (TLH B - 65), etc.) tend to
buffer portfolio volatility to a much greater degree.
My proposal is better because it treats money market funds like
ETFs — they are pass - through vehicles, and
as such, do not need capital
buffers.