ALPS to launch U.S. Equity High Volatility Put Write Index Fund

By Toni Weeks

San Diego, Jan. 19 - ALPS ETF Trust announced its plans to launch the U.S. Equity High Volatility Put Write Index Fund - HVPW, according to an N-1A filing with the Securities and Exchange Commission.

The fund will seek investment results that correspond generally to the performance, before fees and expenses, of the NYSE Arca U.S. Equity High Volatility Put Write Index, an index that measures the return of a hypothetical portfolio consisting of exchange-traded put options that have been sold on each of 20 stocks and a cash position. The 20 stocks are selected from the largest capitalized stocks that also have listed options and the highest volatilities.

The fund will aim to track the index performance by selling listed 60-day put options in proportions to their weightings in the index. When it sells an option, the fund will receive premiums from the option buyer, increasing the fund's return. If the option's underlying stock declines below the strike price, the option will finish in-the-money, and the fund will be required to buy the stock at the strike price, effectively paying the buyer the difference between the strike price and the closing price.

Kevin Rich and Jeff Klearman are the portfolio managers.

Total annual fund operating expenses will be 0.95%, consisting solely of a management fee. Expenses are still being determined.

Denver-based ALPS Advisors, Inc. will serve as the fund's investment adviser.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.