Hedged Premium Income ETF
Seeks to capture the upside of rising equity markets, while hedging against downside and delivering consistent, distributable income.
Objective
Kensington Hedged Premium Income ETF (the “Fund” or “KHPI”) seeks current income with the potential for capital appreciation.
Why Invest
- Attractive Income: The Fund seeks to provide compelling, managed income by combining option premium generation with equity dividend income.
- Participation in Rising Markets: The Fund employs an option writing strategy designed to capture the upside potential of rising equity markets while only partially limiting gains, offering a more attractive profile compared to traditional derivative income strategies.
- Downside Hedge: The Fund’s options hedging strategy is structured to reduce drawdowns during periods of market stress, helping investors remain invested and avoid emotional decision making.
Overview
Allocates to S&P 500 ETFs for potential equity growth and dividend income, while utilizing active option strategies to hedge against market swings and generate premium income.
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S&P 500 Index
The S&P 500 Index is a capitalization weighted index of 500 stocks representing all major domestic industry groups. The S&P 500 Index assumes the reinvestment of dividends and capital gains.
Stay fully invested in Large Cap Equities via low-cost passive ETFs or Future |
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Buy Put Spreads
An options strategy involving buying put options at different strike prices to limit risk and maximize profit.
Maintain quarterly market hedges at all times in seeking to protect capital from significant market declines |
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Sell Call Spreads
An options strategy involving selling call options at different strike prices to limit risk and maximize profit.
Aims to generate positive premium income through conservative call spread writing |
Daily Change
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Yields & Distributions
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Key Facts
Risk Characteristics
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Total Returns (%)
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Growth of $10,000
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Historical Price
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Holdings
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Distributions
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Materials
Regulatory Documents
- Fact Sheet
- Prospectus
- Statement of Additional Information (SAI)
- Notification of Source of Distributions (9/30/2024)
- Notification of Source of Distributions (10/31/2024)
- Notification of Source of Distributions (11/27/2024)
- Notification of Source of Distributions (12/31/2024)
- Notification of Source of Distributions (01/31/2025)
- Notification of Source of Distributions (02/28/2025)
- Notification of Source of Distributions (03/31/2025)
Risk Definitions
Key principal investment risks include, but are not limited to:
- Management Risk: The Adviser’s reliance on its proprietary trend-following model and asset judgments may be incorrect, potentially failing to achieve desired results.
- Equity Securities Risk: Equity securities can experience sudden, unpredictable drops or prolonged declines in value. This may result from general market factors or specific issues affecting industries, sectors, geographic markets, or individual companies.
- Market Risk: Investment market risks, influenced by economic growth, market conditions, interest rates, and political events, affect asset values. Unexpected events like war, terrorism, financial disruptions, natural disasters, pandemics, and recessions can significantly impact investments and market liquidity, causing investor fear and economic instability.
- Underlying Funds Risk: Investments in underlying funds can lead to duplicated fees and expenses. Each fund has specific risks based on its strategy, and its manager may not always succeed. ETF shares might trade at prices different from their net asset value and incur additional trading costs, potentially affecting performance. Market demand can impact the ability to liquidate holdings optimally.
- Derivatives Risk: Derivatives involve leverage, leading to potential gains or losses greater than the initial investment, with value fluctuations that may not perfectly correlate with the market. Futures contracts carry risks like imperfect correlation, lack of liquidity, and unanticipated market movements. Credit default swaps are difficult to value and highly susceptible to liquidity and credit risk. Options are speculative and can result in the loss of the premium paid if the underlying asset’s price does not move favorably.
- Options Risk: Options give the holder the right, but not the obligation, to buy (call) or sell (put) an asset at a specified price. Investments in options are speculative and can result in the loss of the premium paid. Writing options exposes the writer to significant risks, including potential losses up to the exercise price for puts and unlimited losses for uncovered calls.
- Non-Diversification Risk: Non-diversified investments may allocate more than 5% of total assets to one or more issuers, including non-diversified underlying funds. This can make performance more sensitive to single economic, business, political, or regulatory events compared to diversified investments.
- Limited History of Operations Risk: Limited operational history makes it difficult for investors to evaluate its performance. Additionally, the Fund may struggle to attract enough assets to operate efficiently.
For a complete list of potential investment risks associated with this Fund, please refer to its Prospectus.
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How to Invest
KHPI is traded on major stock exchanges, much like shares of common stock. ETFs can be bought and sold throughout the trading day offering liquidity and ongoing valuations of the fund's holdings for investors. ETFs are typically tax-efficient and generally have lower cost than other investment alternatives, making them a great investment tool for investors. Trading can be executed through your financial advisor or an account with most brokerage firms. Commissions and transaction costs may vary so be sure to check on these costs.
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Quarterly Fact Sheet
Most recent returns, key statistics, exposures and holdings related data
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Monthly Commentary
View the Monthly Market Commentary
