Nasdaq Innovation ETFs

The Nasdaq Stock Exchange was the first all-electronic exchange and is one of the largest and most followed US equity stock markets. The exchange is home to more than 3,400 companies, in many cases companies choosing to list on the Nasdaq Stock Exchange mirror the innovative nature of the exchange itself. 

The Nasdaq-100 is a flagship index measuring the performance of the largest 100 non-financial companies listed on the Nasdaq Stock Exchange. These companies include some of the most innovative in their market segments.

Options are financial derivatives that provide the buyer the right, but not the obligation, to purchase or sell an underlying asset at a set price, by a specific date. There are two types of options: call options allow the buyer to buy an asset at a pre-determined strike price and put options allow the holder to sell an asset at a predetermined strike price. Learn more about options and option income strategies here.

Option income strategies, such as Nasdaq-100 Income Advantage, can be an effective way to generate a steady stream of monthly income whilst maintaining exposure to equities. They can diversify an investor’ sources of income and can be a useful tool for reducing interest rate risk and equity market volatility whilst potentially increasing yield. They can be a useful instrument for generating income outside of more traditional means, like collecting dividends on stocks or interest on bonds.

Our Global Strategies team actively manages our ETF to help generate consistent monthly income with less fluctuations in monthly distribution compared to peers. We can manage the income consistency by adjusting option strike prices, as often as daily because of our laddering strategy, as market conditions change. These adjustments can smooth the income profile by reducing the impact of changing option prices as market volatility environments change. By contrast, most other option income strategies do not adjust strike prices and simply allow yields to fluctuate with market volatility. We expect the equity portion of the portfolio can deliver a yield that is similar to the referenced index. The bulk of the yield will likely be generated from the option income strategy.

There are many ways that ETFs can be traded to suit investor’s needs; this can range from a local broker, platform or via the exchange directly (secondary market). Market-makers who trade the ETF provide greater liquidity by constantly quoting their own bid and offer prices. Your broker or online platform may be able to provide you with further information about trading our ETFs. KIIDs and Prospectus information can be found on the ETF product pages.