NEW YORK–(BUSINESS WIRE)–Simplify Asset Management (“Simplify”), an innovative provider of Exchange Traded Funds (“ETFs”), today announced the launch of the Simplify Short Term Treasury Futures Strategy ETF (TUA).
TUA is designed with the twin goals of capital and yield curve efficiency, seeking to target the duration* of the ICE 10-Year US Treasury Index by investing in Treasuries and Treasury futures at the short end of the curve.
The fund is similar in strategy and approach to the Simplify Risk Parity Treasury ETF (TYA), which Simplify launched in September 2021; with the key difference being that TUA focuses on Treasuries and Treasury futures at the short end of the curve, rather than the intermediate, though Simplify notes that TUA can potentially create more efficient intermediate duration exposure by capitalizing on favorable roll yields at the short end of the Treasury curve.
“We’re pleased to be adding TUA to our fund lineup and see a number of key use cases, particularly in the current environment,” said David Berns, Ph.D., CIO and Co-Founder with Simplify. “Given its levered exposure to short-term Treasuries, TUA can be used to gain short duration exposure with only a fraction of the capital required by an unlevered position, significantly increasing capital efficiency. It can also be used as the building block in a variety of innovative portfolio solutions, including risk parity.”
TUA and TYA are part of Simplify’s fast-growing ETF lineup, which includes two standout 2022 performers, the Simplify Interest Rate Hedge ETF (PFIX) and the Simplify Managed Futures Strategy ETF (CTA), along with two other recent additions to the firm’s fixed income suite in the Simplify Stable Income ETF (BUCK) and Simplify Enhanced Income ETF (HIGH), both which launched on October 27th.
*Duration: A measure of the sensitivity of the price of a bond to a change in interest rates.
ABOUT SIMPLIFY ASSET MANAGEMENT INC
Simplify Asset Management Inc. is a Registered Investment Adviser founded in 2020 to help advisors tackle the most pressing portfolio challenges with an innovative set of options-based strategies. By accounting for real-world investor needs and market behavior, along with the non-linear power of options, our strategies allow for the tailored portfolio outcomes for which clients are looking. For more information, visit www.simplify.us.
Investors should carefully consider the investment objectives, risks, charges, and expenses of Exchange Traded Funds (ETFs) before investing. To obtain an ETF’s prospectus containing this and other important information, please call (855) 772-8488, or visit SimplifyETFs.com. Please read the prospectus carefully before you invest.
An investment in the fund involves risk, including possible loss of principal.
The fund is actively managed and is subject to the risk that the strategy may not produce the intended results. The fund is new and has a limited operating history to evaluate.
When the Fund invests in fixed income securities, the value of your investment in the Fund will fluctuate with changes in interest rates. Typically, a rise in interest rates causes a decline in the value of fixed income securities owned by the Fund.
Authorized Participant Risk: Only an Authorized Participant may engage in creation or redemption transactions directly with the Fund. The Fund has a limited number of institutions that may act as an Authorized Participant on an agency basis (i.e., on behalf of other market participants).
Derivatives Risk: Options are a derivative investment. The use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments.
Futures Contract Risk: Futures contracts involve the following risks (a) the imperfect correlation between the change in market value of the instruments held by the Fund and the price of the forward or futures contract; (b) possible lack of a liquid secondary market; (c) leverage, which means a small percentage of assets in futures can have a disproportionately large impact on the Fund and the Fund can lose more than the principal amount invested; (d) losses are potentially unlimited; (f) the possibility that the counterparty will default in the performance of its obligations.
Leverage Risk: The use of leverage by the Fund, such as the use of options, may cause the Fund to incur additional expenses and magnify the Fund’s gains or losses.
Option Risk: As the buyer of a put or call option, the Fund risks losing the entire premium invested in the option if the Fund does not exercise the option.
Short-term investment Risk: Investors holding shares of the Fund over longer-term periods may be subject to increased risk of loss. The Fund is intended to be used only for short-term investment horizons. An investor in the Fund can lose all or a substantial portion of his or her investment within a single day. The longer an investor’s holding period in the Fund, the greater the potential for loss.
Simplify ETFs are distributed by Foreside Financial Services, LLC.
Chris Sullivan/Patrick Phalon