XVOL Profile
The Acruence Active Hedge U.S. Equity ETF is an actively managed exchange-traded fund designed to provide investors with a dual approach to equity investing and volatility management. The fund primarily allocates nearly all of its assets to a portfolio that mirrors the constituents and weights of the S&P 500 Index. This strategy aims to capture the broad performance of U.S. large-cap equities while implementing an active management approach to enhance returns and manage risk.
To achieve its objective of reducing volatility, the fund incorporates a sophisticated hedging strategy by purchasing options contracts on the CBOE Volatility Index (VIX). The VIX, often referred to as the "fear gauge," measures market expectations of near-term volatility, and the inclusion of VIX options provides a mechanism to hedge against market fluctuations and reduce overall portfolio volatility. This approach is intended to stabilize the fund's performance during periods of market turbulence.
The funds advisor plans to gain exposure to VIX options through investments in a subsidiary, which may hold up to 20% of the funds total assets. This structure allows the fund to leverage specialized investment strategies and manage volatility effectively while maintaining the core equity exposure to the S&P 500 Index. The subsidiary approach facilitates targeted investment in VIX options without directly affecting the primary equity holdings.
As a non-diversified ETF, the Acruence Active Hedge U.S. Equity ETF focuses on a concentrated strategy involving the S&P 500 Index and VIX options. By combining exposure to a broad range of large-cap U.S. stocks with a dedicated volatility hedging component, the fund aims to offer investors both growth potential and risk management, catering to those seeking a balanced approach to equity investing with a focus on mitigating market volatility.
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