Nationwide Risk-Managed Income ETF breaks $500 million threshold
Nationwide celebrates milestone with NYSE bell ringing
Columbus, OH – With interest rates remaining near historic lows and continued market uncertainty, income investors are flocking to the Nationwide Risk-Managed Income ETF (TRADING SYMBOL: NUSI), which recently surpassed the $500 million mark for assets under management. The fund has achieved this success in less than two years by serving the needs of investors seeking income with a measure of downside protection. Nationwide is celebrating the milestone by ringing the closing bell at the New York Stock Exchange today.
“We recognized the challenges income investors face when seeking to generate high current income in today’s market when we introduced NUSI,” said Mike Spangler, senior vice president of Nationwide’s Investment Management Group. “Income from the asset classes that investors have traditionally turned to has decreased with interest rates, and those still offering higher income have heightened exposure to principal risk.”
“We believed the market was ready for an innovative approach when we partnered with Harvest Volatility Management to launch NUSI in late 2019,” said Marge Farquharson, senior director, Exchange Traded Funds at Nationwide. “Reaching $500 million just twenty months after launch is a testament to the interest investors have in a solution that seeks to balance income generation and risk reduction as the foundation for retirement readiness and long-term financial wellness.”
NUSI seeks to generate investment income and provide a measure of downside protection through an innovative approach to traditional income investing by deploying an options strategy called a protective net-credit collar. This strategy is established by combining a covered call, where it sells an upside call option, and a protective put, where it uses a portion of the proceeds received to fully finance the purchase of a downside put option.
“Nationwide’s unwavering commitment to broadening investor access to institutional-quality solutions and its emphasis on long-term value creation made Nationwide an ideal strategic partner for Harvest,” said Curt Brockelman, co-founder and managing partner of Harvest Volatility Management LLC, the named subadvisor for NUSI. “We are tremendously pleased with the partnership and the success of NUSI and look forward to continuing to lend our distinct expertise in seeking to deliver positive investor outcomes.”
Fundamentally designed with income-generation in mind, the Nationwide Risk-Managed Income ETF potentially offers several benefits that may address the yield enhancement and volatility management needs of investors, including seeking:
- High monthly income generation
- Portfolio volatility reduction
- Reduced duration risk and interest rate sensitivity
- Capital appreciation from equity participation
- Downside risk mitigation
The Fund is listed on the New York Stock Exchange and has an expense ratio of 0.68%.
Investors interested in learning more about the Nationwide Risk-Managed Income ETF should contact their financial professional or visit the website. Financial professionals interested in learning more about Nationwide ETFs can call 1-877-893-1830.
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the United States. Nationwide is rated A+ by both A.M. Best and Standard & Poor’s. An industry leader in driving customer-focused innovation, Nationwide provides a full range of insurance and financial services products including auto, business, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; excess & surplus, specialty and surety; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com. Follow us on Facebook and Twitter.
Founded in 2008, Harvest Volatility Management (“Harvest”) is a leading options and volatility risk management-focused investment firm that offers a robust suite of actively-managed options-based strategies that span yield enhancement overlays, risk reduction, alternative beta, and absolute return investment solutions. Led by investment professionals with decades of experience in advising, structuring and managing option-related strategies, Harvest is an accomplished provider of derivative trading strategies, as well as risk management solutions designed to enhance yield and reduce asset class risk exposure.
This material is not a recommendation to buy, sell, hold or roll over any asset, adopt an investment strategy, retain a specific investment manager or use a particular account type. It does not take into account the specific investment objectives, tax and financial condition, or particular needs of any specific person. Investors should work with their financial professional to discuss their specific situation.
Call 800-617-0004 to request a summary prospectus and/or a prospectus, or download prospectuses at etf.nationwide.com. These prospectuses outline investment objectives, risks, fees, charges and expenses, and other information that you should read and consider carefully before investing.
Investing involves risk, including the possible loss of principal. Shares of any ETF are bought and sold at market price (not NAV), may trade at a discount or premium to NAV and are not individually redeemed from the Fund. Brokerage commissions will reduce returns. The Fund’s return may not match or achieve a high degree of correlation with the return of the underlying index.
Beta is a measure of price variability relative to the market.
KEY RISKS: The Fund is subject to the risks of investing in equity securities, including tracking stock (a class of common stock that “tracks” the performance of a unit or division within a larger company). A tracking stock’s value may decline even if the larger company’s stock increases in value. The Fund is subject to the risks of investing in foreign securities (currency fluctuations, political risks, differences in accounting and limited availability of information, all of which are magnified in emerging markets). The Fund may invest in more-aggressive investments such as derivatives (which create investment leverage and illiquidity and are highly volatile). The Fund employs a collared options strategy (using call and put options is speculative and can lead to losses because of adverse movements in the price or value of the reference asset). The success of the Fund’s investment strategy may depend on the effectiveness of the subadviser’s quantitative tools for screening securities and on data provided by third parties.
The Fund expects to invest a portion of its assets to replicate the holdings of an index. Correlation between Fund performance and index performance may be affected by Fund expenses and because the Fund may not be invested fully in the securities of the index or may hold securities not included in the index.
The Fund frequently may buy and sell portfolio securities and other assets to rebalance its exposure to various market sectors. Higher portfolio turnover may result in higher levels of transaction costs paid by the Fund and greater tax liabilities for shareholders. The Fund may concentrate on specific sectors or industries, subjecting it to greater volatility than that of other ETFs. The Fund may hold large positions in a small number of securities, and an increase or decrease in the value of such securities may have a disproportionate impact on the Fund’s value and total return. Although the Fund intends to invest in a variety of securities and instruments, the Fund will be considered nondiversified. Additional Fund risk includes: Collared options strategy risk, correlation risk, derivatives risk, foreign investment risk, and industry concentration risk.
Nasdaq-100 Index: An unmanaged, market capitalization-weighted index of the 100 largest, most actively traded U.S companies listed on the Nasdaq stock exchange. The Index includes companies from various industries except for the financial industry, like commercial and investment banks. These non-financial sectors include retail, biotechnology, industrial, technology, health care, and others.
A call option is a financial contract that give the option buyer the right, but not the obligation, to buy a stock, bond, commodity other asset or instrument at a specified price within a specific time period.
A covered call is a financial market transaction in which the seller of call options owns the corresponding amount of the underlying instrument, such as shares of a stock or other securities.
A put option is a contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying security at a pre-determined price within a specified time frame.
Duration is a measure of the sensitivity of the price of a bond or other debt instrument to a change in interest rates.
Nationwide Fund Advisors (NFA) is the registered investment advisor to Nationwide ETFs, which are distributed by Quasar Distributors LLC.Nationwide Funds distributed by Nationwide Fund Distributors LLC (NFD), member FINRA, Columbus, OH. NFD is not affiliated with any subadviser contracted by Nationwide Fund Advisors (NFA), with the exception of Nationwide Asset Management, LLC (NWAM). Nationwide Investment Services Corporation (NISC), member FINRA.
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