Calamos ETF Bundles 100% Downside Protection

The new ETF of ETFs aims to tap into the popularity of BUFR.

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Jeff_Benjamin
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Wealth Management Editor
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Reviewed by: etf.com Staff
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Edited by: James Rubin

Calamos Investments is hoping to give financial advisors what they want with the new Calamos Laddered S&P 500 Structured Alt Protection ETF (CPSL), which invests in ETFs that provide 100% downside protection in exchange for upside caps on performance.

CPSL, which starts trading Monday, Sept. 9, will debut with four underlying ETFs, but the holdings will expand to 12 as Calamos rolls out a full slate of downside protection funds that have 12-month maturities.

Calamos, based in Naperville, Ill., is tapping into the growing appeal of buffered and defined outcome ETFs that have been described as “Boomer Candy” for their popularity among investors looking to maintain equity market exposure while benefiting from some downside protection.

CPSL is similar to the wildly popular $5 billion FT Cboe Vest Fund of Buffer ETF (BUFR), which is a fund of buffer ETFs that offer various levels of downside protection.

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CPSL's Use for Multiple Portfolios

CPSL invests only in ETFs that offer 100% downside protection, but because of the laddered nature of the underlying ETFs, its downside protection will not be 100%.

According to Matt Kaufman, head of ETFs at Calamos, a three-year rolling back test of the strategy showed a maximum peak-to-trough drawdown of 1.9%, which compares to 23.9% for the S&P 500 Index and 16.4% for the U.S. Aggregate Bond Index over the same period.

Kaufman said the appeal among financial advisors is the ability to use CPSL in model portfolios and across multiple client portfolios without having to worry about rolling into new defined outcome ETFs as they mature every 12 months.

“This gives you laddered exposure to all the S&P 500 structured protection ETFs in the marketplace,” he said. “And you end up with a remarkably similar experience to what you would get by directly owning the underlying ETFs.”

Nate Geraci, president of The ETF Store in Overland Park, Kans., recognizes how a fund like CPSL can help advisors “manage the timing risk associated with implementing these strategies.”

Advisors and investors can simply buy a single ticker to access a series of 100% downside protection ETFs, which could make these more attractive from an ease-of-use perspective,” he added.

That is exactly the point Calamos is betting on with CPSL.

“Some advisors like to use a single month for the 100% downside protection with exact upside cap,” said Kaufman. “But others are looking for a single ticker solution.”

Jeff Benjamin is the wealth management editor at etf.com, responsible for coverage related to the financial planning industry. This includes writing, hosting podcasts, webinars, video interviews and presenting at in-person events.


Jeff is a veteran journalist with more than 30 years’ experience covering the financial markets. He has won more than two dozen national and regional awards for his reporting. He most recently worked as a senior columnist at InvestmentNews where he wrote about investment products and strategies, as well as the broader financial planning industry. Prior to that, Jeff worked as an analyst at Cerulli Associates where he researched and wrote reports on the alternative investments industry. Jeff also worked as a money management reporter at Dow Jones Newswires, where he covered the mutual fund industry.


Based in North Carolina, Jeff is a former Marine and has a bachelor’s degree in journalism from Central Michigan University.