- Innovator MSCI Emerging Markets Power Buffer ETF – July (EJUL)
- Innovator MSCI EAFE Power Buffer ETF – July (IJUL)
IJUL and EJUL are actively managed structured products in ETF wrappers. They are designed to track the price return of the MSCI EAFE and MSCI EM indexes with capped gains and buffered losses.
They way they work, basically, is as an option spread play. The funds buys options in such a way that it protects investors from the first 15% of losses. (Beyond 15%, the fund will participate in losses). To compensate for this, the fund caps gains at somewhere near 8% a year, depending on what the options market is offering.
Investors wanting this defined outcome are required to invest for the whole year. Those who invest outside this time frame are not guaranteed the defined outcome. The fund resets every 1 July.