Liquid Strategies adds two new ‘Overlay Shares’ ETFs

Jan 21st, 2021 | By | Category: Alternatives / Multi-Asset

Atlanta-based investment advisor Liquid Strategies has expanded its suite of options-enhanced ETFs with the launch of two new strategies targeting US large-cap equities and short-duration corporate bonds.

Shawn Gibson, CIO for Liquid Strategies and Overlay Shares

Shawn Gibson, CIO at Liquid Strategies.

Branded ‘Overlay Shares’, the products provide core index exposure via third-party ETF combined with an actively managed options overlay that seeks to enhance returns through incremental tax-efficient income.

Its latest products are the Overlay Shares Short Term Bond ETF (OVT US) and the Overlay Shares Large Cap Hedged Equity ETF (OVLH US).

The passive portion of these strategies is delivered via the Vanguard Short-Term Corporate Bond ETF and Vanguard S&P 500 ETF respectively.

OVT combines the benefits of investing in short-duration bonds with income potential from the option overlay strategy utilized in the existing suite of ETFs.

OVLH combines the benefits of investing in the S&P 500 with long-term bear market hedges, sought to be financed through the option overlay strategy.

OVT and OVLH come with expense ratios of 0.78% and 0.80% respectively.

Shawn Gibson, CIO at Liquid Strategies, commented: “Since the initial launch of Overlay Shares, our team has worked to provide solutions to help solve investor problems. With the launch of OVT and OVLH, we’re providing even more tools to allow investors and their clients to adapt to changing market risks and opportunities as we move into a very uncertain 2021.”

Liquid Strategies debuted its first ETFs in October 2019 with the suite recently surpassing $300 million in assets under management. The funds, outlined below, include three equity ETFs targeting US large-cap, US small-cap, and global ex-US stocks, as well as two fixed income ETFs covering USD aggregate and municipal bond markets.

The Overlay Shares Large Cap Equity ETF (OVL US) provides options-enhanced exposure to US large-cap equities by investing in the Vanguard S&P 500 ETF.

The Overlay Shares Small Cap Equity ETF (OVS US) provides options-enhanced exposure to US small-cap equities by investing in the iShares Core S&P Small Cap 600 ETF.

The Overlay Shares Foreign Equity ETF (OVF US) provides options-enhanced exposure to global ex-US equities by investing 80% in the iShares Edge MSCI Min Vol EAFE ETF and 20% in the iShares Edge MSCI Min Vol Emerging Markets ETF.

The Overlay Shares Core Bond ETF (OVB US) provides options-enhanced exposure to US aggregate bonds by investing in the iShares Core US Aggregate Bond ETF.

The Overlay Shares Municipal Bond ETF (OVM US) provides options-enhanced exposure to municipal bonds by investing in the iShares National Muni Bond ETF.

The funds come with expense ratios ranging from 0.79% to 0.95%.

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