Simplify Exchange Traded Funds (XV)

History and Background

Simplify Asset Management was founded in 2020 by Paul Kim and Michael Green. They focus on offering ETFs with options overlays and other strategies designed to enhance returns, manage volatility, and provide downside protection.

Core Business Areas

• ETF Management: Creation and management of a variety of ETFs covering different asset classes and investment strategies, often incorporating options overlays.
• Options Overlay Strategies: Implementation of options-based strategies within ETFs to enhance returns, manage risk, or generate income.
• Investment Research: Providing investment research and insights to support their ETF offerings and inform investment decisions.

Leadership and Structure

Paul Kim serves as CEO and Michael Green as Chief Strategist. The company has a team of portfolio managers, analysts, and operations personnel.

Key Offerings

• SPYC - Simplify US Equity PLUS Convexity ETF: Aims to provide exposure to the S&P 500 while enhancing returns through a dynamic options overlay strategy. Competitors include: JPMorgan Equity Premium Income ETF (JEPI), Global X Nasdaq 100 Covered Call ETF (QYLD). Market share data is not readily available.
• VVIX - Simplify Volatility Index PLUS Convexity ETF: Seeks capital appreciation by investing in VIX futures contracts and using options to generate income. Competitors include: ProShares VIX Short-Term Futures ETF (VIXY), iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX). Market share data is not readily available.
• FIG - Simplify Interest Rate Hedge ETF: Seeks to protect portfolios from rising interest rates. Competitors include: ProShares Short 20+ Year Treasury (TBF), Direxion Daily 20+ Year Treasury Bear 3X Shares (TMV). Market share data is not readily available.

Industry Overview

The ETF market is highly competitive and growing rapidly, with increasing demand for specialized strategies like options overlays and hedge funds alternatives. Lower cost and ease of trading continue to fuel growth.

Positioning

Simplify is positioned as an innovator offering specialized ETFs using options and other sophisticated strategies. Their competitive advantage lies in their expertise in options strategies and their ability to create unique ETF products.

Total Addressable Market (TAM)

The total ETF market is estimated in the trillions of dollars. Simplify is positioned to capture a small but growing share of this TAM through its specialized offerings.

Key Competitors

• JEPI
• QYLD
• VIXY
• VXX
• TBF
• TMV

Competitive Landscape

Simplify differentiates itself through specialized options strategies. Larger competitors have lower expense ratios and broader distribution networks.

Historical Growth: Simplify has experienced growth in AUM since its inception, driven by demand for its innovative ETF products.

Future Projections: Future growth is projected to be driven by continued demand for alternative investment strategies and expansion into new markets.

Recent Initiatives: Launching new ETFs with innovative options strategies, forming partnerships with other financial institutions.

Simplify Asset Management is a relatively new company making waves in the ETF market through its innovative and specialized options-based strategies. While they face stiff competition from larger, more established firms, their focus on providing unique solutions for managing volatility and enhancing returns positions them for potential growth. However, investors must carefully consider the complexity and higher costs associated with their products.

Data Sources:

• Simplify Asset Management website
• ETF.com
• Bloomberg
• SEC filings

Disclaimers:

The information provided is for informational purposes only and should not be considered investment advice. Market share data is estimated and may not be precise. Investors should conduct their own due diligence before making any investment decisions.