The Key to 4x S&P 500 Income Without Sacrificing Upside

Behind the Ticker offers investors a chance to get under the hood of newer or more niche ETFs. Brad Roth, Managing Partner and CIO of Thor Financial Technologies, talks strategy and the human side of investing and ETFs with the individuals bringing these funds to market. 

In this episode, Roth talks with Sean O'Hara, President of Pacer ETFs Distributors about the inception of Pacer and the firm's experience in ETFs, as well as how the ETF line-up has grown and evolved over time. The two then get under the hood of the Pacer Metaurus US Large Cap Dividend Multiplier 400 ETF (QDPL) that seeks to solve for baby boomer income needs without sacrificing upside or growth potential.

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Key Topics Discussed

• Pacer avoids competing with the big three when it comes to low-cost beta by instead focusing on strategies that offer unique outcomes. Every product is designed to be unique, disruptive, or innovative and solve for a specific problem, such as risk management or enhanced income, that a standard index fund cannot.
• QDPL delivers four times the S&P 500 dividend yield by investing 85% of assets int he index while the remaining 15% goes to T-bill collateral and dividend futures. This structure allows investors to maintain significant equity growth potential while generating a target cash flow of roughly 5% at current levels.
• A key advantage of QDPL is that the bulk of its distributions are classified as Return of Capital, a tax benefit for many investors. Additionally, the strategy captures the 5-7% annual growth of S&P 500 dividends, providing an inflation hedge that traditional fixed-income products often lack.
• As a privately held firm, Pacer can afford to let thematic ETFs like the Pacer Data and Infrastructure Real Estate ETF (SRVR), that focuses on data centers, find their footing over several years before they gain market traction. This long-term approach led to the launch of the Pacer Data and Digital Revolution ETF (TRFK), which captures the AI infrastructure ecosystem from hardware to power generation.
• Unlike many digital-first firms, Pacer employs a sales force of over 120 people to build deep relationships with RIAs and wirehouse advisors. O'Hara argues that this expensive, traditional model is essential for educating advisors on how complex products like QDPL fit into a diversified portfolio. 

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Disclaimer: The market insights, projections, and investment strategies expressed in this podcast are solely those of the contributor and do not necessarily reflect the views or opinions of ETF.com This content is provided for informational purposes and does not constitute financial, investment, or legal advice.