Global Markets
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The Cboe S&P 500 10% Buffered 75 Index Series (the “Indices”) is part of a family of Target Outcome Indices. The Indices are designed to provide target outcome returns to the US domestic stock market.
Each series in the index is designed to track the returns of a hypothetical investment that over a period of approximately one year seeks to “buffer protect” against the first 10% of losses due to a decline in the S&P 500 Index while providing participation up to a capped level. The capped level is determined on each annual Roll Date such that there is a premium set to the 1-year maturity of a Secured Overnight Financing Rate (SOFR) based curve to enter into the hypothetical investment.
There are 12 monthly series that roll 3 business days before the last business day of each month:
The Indices are part of the outcome based approach to investing. Most investments today target speculative returns, with uncertain levels of risk, over an uncertain period of time. While opportunistic, this approach to investing brings a high degree of uncertainty. Outcome based investing encourages targeting a specific defined return or "payoff", with an allowance for a specific defined risk, at a specific point in time in the future.
A Buffer Protection Option Strategy is a protection strategy that is generally used in a bear, range-bound or modest bull market environment. It seeks to provide a buffer of protection against downside losses over a set period of time, while still providing the opportunity for growth to a maximum pre-determined level. The strategy seeks to provide similar returns to the S&P 500 Index, with lower volatility and downside risks, in most market environments with the exception of when the stock market is rallying rapidly.
