NEW
YORK, May 8, 2024 /PRNewswire/ -- Global X ETFs,
the New York-based provider of
exchange-traded funds (ETFs), today launched the Global X MLP &
Energy Infrastructure Covered Call ETF (MLPD) and the Global X
S&P 500 Quality Dividend Covered Call ETF (QDCC). The funds are
Global X's latest additions to its covered call suite, which offers
investors ETF strategies that look beyond traditional fixed income
to potentially increase or diversify a portfolio's yield.
Covered call strategies can play an important role in a
portfolio, offering a diversified source of income while helping to
potentially mitigate downside risk. While covered call strategies
once required investors to trade options themselves, the
availability of covered call ETFs can help investors more easily
and efficiently integrate these strategies.
The Global X MLP & Energy Infrastructure Covered Call ETF
(MLPD) and the Global X S&P 500 Quality Dividend Covered Call
ETF (QDCC) seek to offer diversified income by holding and then
writing call options on the Global X MLP & Energy
Infrastructure ETF (MLPX) and the Global X S&P 500 Quality
Dividend ETF (QDIV) respectively.
"During volatile markets, elevated premiums can make covered
call strategies especially appealing for investors seeking higher
income and risk management," said Rohan
Reddy, Director of Research at Global X ETFs. "Global X is a
long-time leader when it comes to exchange-traded covered call
strategies, and these latest two offerings build on our leadership
by offering income solutions to investors seeking access to MLPs or
quality dividend equities."
The Global X MLP & Energy Infrastructure Covered Call ETF
(MLPD) and the Global X S&P 500 Quality Dividend Covered Call
ETF (QDCC) seek to provide investment results that correspond,
before fees and expenses, to the Cboe MLPX ATM BuyWrite Index and
the Cboe QDIV ATM BuyWrite Index, respectively. MLPD carries an
expense ratio of 0.60% and QDCC carries an expense ratio of
0.35%.
About Global X ETFs:
Global X ETFs was founded in 2008. For more than a decade, our
mission has been empowering investors with unexplored and
intelligent solutions. Our product lineup features a wide range of
ETF strategies and over $47 billion in U.S. assets under
management.iv While we are distinguished for our
Thematic Growth, Income and International Access ETFs, we also
offer both Core and Commodity funds to suit a wide range of
investment objectives. Explore our ETFs, research and insights, and
more at www.globalxetfs.com.
Global X is a member of Mirae Asset Financial Group, a global
leader in financial services, with more than $600
billion in assets under management
worldwide.v Mirae Asset has an extensive global ETF
platform ranging across the US, Brazil, Canada, Colombia, Europe, Hong
Kong, India, Japan, Korea, and Vietnam with over $120bn in assets under management.
vi
Important Disclosures:
Strategies discussed may not be suitable for all investors.
Please consult a financial professional for more information
regarding your investment situation.
Investing involves risk, including the possible loss of
principal. Diversification does not ensure a profit or guarantee
against a loss. Investors should be willing to accept a high degree
of volatility in the price of the funds' shares and the possibility
of significant losses.
The funds engage in options trading. An option is a contract
sold by one party to another that gives the buyer the right, but
not the obligation, to buy (call) or sell (put) a stock at an
agreed upon price within a certain period or on a specific date. A
covered call option involves holding a long position in a
particular asset and writing a call option on that same asset with
the goal of realizing additional income from the option premium. By
selling covered call options, the fund limits its opportunity to
profit from an increase in the price of the underlying asset above
the exercise price, but continue to bear the risk of a decline in
the asset. A liquid market may not exist for options held by the
funds. While the fund receives premiums for writing the call
options, the price it realizes from the exercise of an option could
be substantially below the indices current market price.
Investments in securities of MLPs involve risk that differ from
investments in common stock including risks related to limited
control and limited rights to vote on matters affecting the MLP.
MLP common units and other equity securities can be affected by
macro-economic and other factors affecting the stock market in
general, expectations of interest rates, investor sentiment towards
MLPs, changes in a particular issuer's financial condition, or
unfavorable or unanticipated poor performance of a particular
issuer (in the case of MLPs, generally measured in terms of
distributable cash flow). MLPD invests in the energy industry,
which entails significant risk and volatility.
MLPD also expects to pay distributions, which will be treated as
a return of capital for tax purposes rather than from net profits
and shareholders should not assume that the source of distributions
is from the net profits of the Fund.
Neither the Fund nor the Adviser has control over the actions of
underlying MLPs. The amount of cash that each individual MLP can
distribute to its partners will depend on the amount of cash it
generates from operations, which will vary from quarter to quarter
depending on factors affecting the energy infrastructure market
generally. Available cash will also depend on the MLPs' level of
operating costs (including incentive distributions to the general
partner), level of capital expenditures, debt service requirements,
acquisition costs (if any), fluctuations in working capital needs,
and other factors. The MLP holdings of the underlying fund expect
to generate significant investment income, and the fund's
investments may not distribute the expected or anticipated levels
of cash, resulting in the risk that the fund may not have the
ability to make cash distributions as investors expect from
MLP-focused investments. Past distributions are not indicative of
future distributions. There is no guarantee that dividends will be
paid. Companies may reduce or eliminate dividends at any time.
Carefully consider the funds' investment objectives, risks,
and charges and expenses before investing. This and other
information can be found in the funds' full or summary
prospectuses, which may be obtained at globalxetfs.com. Please read
the prospectus carefully before investing.
Global X Management Company LLC serves as an advisor to Global X
Funds. The Funds are distributed by SEI Investments Distribution
Co., which is not affiliated with Global X Management Company LLC
or Mirae Asset Financial Group.
CONTACT: Naomi
Sussis, nsussis@globalxetfs.com
iv Source: Global X ETFs, as of April
2024
v Source: Mirae Asset, as of April
2024
vi Source: Mirae Asset, as of April
2024
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SOURCE Global X Management Company LLC