WisdomTree launches S&P 500 put options ETF

US equities near record highs

WisdomTree has expanded its ETF suite with the launch of an S&P 500 put options fund, offering investors US market exposure and the potential to mitigate volatility as the index nears record highs.

The WisdomTree Cboe S&P 500 PutWrite UCITS ETF's strategy will be able to sell S&P 500 put options and invest the proceeds in one and three-month US Treasuries. A put option gives an investor the option to sell assets at an agreed price on or before a particular date. Rebalanced monthly, the S&P 500 options will be written "at the money", which is when the option's price is identical to the price of the underlying security, at the time of the monthly roll. The firm said for assuming the risk of market losses through the put positions, the ETF will earn a volatility risk premium, wh...