XTAP Profile
The Innovator U.S. Equity Accelerated Plus ETF - April is an actively managed exchange-traded fund (ETF) focused on delivering performance linked to the SPDR S&P 500 ETF Trust. To achieve its investment objective, the fund allocates at least 80% of its net assets to a portfolio of FLEX Options. These options reference the SPDR S&P 500 ETF Trust, which aims to track the investment results of the S&P 500 Index, a benchmark representing the performance of 500 leading U.S. companies across various industries.
FLEX Options, or Flexible Exchange Options, are exchange-traded options contracts known for their customizable features, allowing investors to tailor terms such as expiration dates and strike prices. Despite being guaranteed for settlement by the Options Clearing Corporation (OCC), FLEX Options carry counterparty risk, as the OCC acts as an intermediary in the settlement process. This setup can introduce risks related to the liquidity and pricing of these options compared to more traditional, standardized options contracts.
The funds strategy involves actively managing the portfolio to maintain exposure to these FLEX Options, aiming to capitalize on market movements associated with the SPDR S&P 500 ETF Trust. By focusing on a customized options strategy, the fund seeks to enhance its performance potential, although this approach may result in less liquidity and increased complexity compared to conventional investment methods.
Given its investment approach, the fund is classified as non-diversified, concentrating its assets in FLEX Options linked to a single underlying ETF. This concentrated strategy reflects the funds focus on leveraging specific market opportunities through tailored options contracts, aligning with its goal to provide accelerated and amplified returns based on the performance of the S&P 500 Index.
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