AIM ETF Products Trust - AllianzIM U.S. Large Cap Buffer20 Oct ETF (OCTW)

Overview

The AllianzIM U.S. Large Cap Buffer20 Oct ETF (OZOO) seeks to provide investors with buffered exposure to the S&P 500 Price Return Index while limiting downside risk by 20% over a one-year period, reset annually in October. It focuses on U.S. large-cap stocks and employs a strategy that combines exposure to the index with options to provide a buffer against market declines.

Reputation and Reliability

Allianz Investment Management (AllianzIM) is a well-established asset manager with a long history of providing investment solutions. They are known for their expertise in risk management and options strategies.

Management Expertise

AllianzIM has a team of experienced portfolio managers and options specialists dedicated to managing their buffered ETF products.

Goal

To provide investors with buffered exposure to the S&P 500 Price Return Index, limiting downside risk by 20% over a one-year period.

Investment Approach and Strategy

Strategy: The ETF uses a combination of index exposure and options contracts (primarily put options) to create a buffer against the first 20% of market declines over the period.

Composition The ETF primarily holds investments that provide exposure to the S&P 500, along with a portfolio of options contracts designed to create the downside buffer.

Market Share: OZOO holds a moderate market share within the buffered ETF category, but still relatively small compared to the broader S&P 500 tracking ETFs.

Total Net Assets (AUM): 33952431

Key Competitors

• Innovator U.S. Equity Buffer ETF (BJUL)
• Simplify US Equity PLUS Downside Convexity ETF (SPCX)

Competitive Landscape

The buffered ETF market is competitive, with various providers offering similar strategies with different buffer levels and reset periods. OZOO competes on its buffer amount, the underlying index and the brand name of AllianzIM. Competitors may have lower expense ratios or different buffer strategies making them more attractive to specific investors.

Historical Performance: Historical performance depends on the specific period analyzed and market conditions. Buffered ETFs aim to track the upside performance of the underlying index up to a cap, while providing downside protection during market declines. This information is best obtained from live data and reputable financial data providers.

Benchmark Comparison: The ETF's performance should be compared to the S&P 500 Price Return Index, considering the buffer and cap features. The benchmark should be assessed on total return, volatility and risk-adjusted return.

Expense Ratio: 0.77

Average Trading Volume

OZOO's average trading volume is moderate, which may lead to wider bid-ask spreads.

Bid-Ask Spread

The bid-ask spread varies but is typically wider than highly liquid ETFs tracking the S&P 500 due to its options component and lower trading volume.

Market Environment Factors

Economic growth, interest rates, inflation, and geopolitical events all influence the performance of the S&P 500 and, consequently, OZOO. Market volatility also directly affects the pricing and effectiveness of the ETF's options strategy.

Growth Trajectory

Growth depends on investor demand for downside protection and market performance. Changes to strategy and holdings are disclosed in fund prospectuses.

Competitive Edge

OZOO benefits from AllianzIM's expertise in options strategies and risk management, which are critical for implementing the buffered strategy. The 20% buffer provides a defined level of downside protection, appealing to risk-averse investors. AllianzIM's established brand name and reputation can also attract investors. However, the buffer comes at the cost of capped upside participation and a potentially higher expense ratio compared to plain vanilla ETFs. Investor education regarding the ETF's mechanism is also crucial for adoption.

Volatility

OZOO's volatility is generally lower than the S&P 500 due to the downside buffer, but it still experiences market risk.

Market Risk

The ETF is subject to market risk, as its performance is tied to the S&P 500. The buffer only protects against a portion of the downside risk, and upside potential is capped.

Ideal Investor Profile

The ideal investor is risk-averse, seeking buffered exposure to the S&P 500 and willing to sacrifice some upside potential for downside protection.

Market Risk

OZOO is best suited for long-term investors who are looking for downside protection in their large-cap equity allocation but active traders may find it useful for shorter-term hedging.

The AllianzIM U.S. Large Cap Buffer20 Oct ETF (OZOO) offers buffered exposure to the S&P 500, limiting downside risk by 20% over a one-year period. It employs a combination of index exposure and options contracts. This ETF provides downside protection, which may appeal to risk-averse investors. However, upside participation is capped, and the expense ratio is higher than traditional index funds, so it is important to consider the ETF's objectives and strategy relative to individual needs.

Data Sources:

• AllianzIM Website
• ETF.com
• Morningstar
• Bloomberg

Disclaimers:

The data and analysis provided are for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.