Anyone familiar with bitcoin investing likely knows that the asset class is prone to seeing huge price swings in a short span of time.
These price swings can certainly go either way, leading to resonating rallies, massive drawdowns, or something in between. That being said, bitcoin has certainly trended in a largely positive direction as of late.
Navigating these price swings is usually part of the challenge of investing in bitcoin. And given bitcoin’s recent performance and its merits as a store of value, there’s certainly plenty of reasons why advisors and investors would want to add the cryptocurrency to the portfolio.
For those looking to navigate bitcoin’s price swings in an efficient manner, the Calamos Laddered Bitcoin 80 Series Structured Alt Protection ETF (CBTL) may help. Managed by Calamos Investments, CBTL provides laddered access to a collection of four different Calamos Protected Bitcoin ETFs.
These underlying ETFs use an options strategy to generate exposure to bitcoin in a risk-adjusted manner. After covering fees and expenses, the funds limit total loss to -20% across their one-year outcome periods. Considering how far bitcoin could fall in just a single day, this level of downside protection may provide investors with some peace of mind as they pursue bitcoin returns.
Speaking of returns, CBTL may provide very strong capital appreciation over the long term. Yes, the underlying ETFs in these portfolios all have upside caps on potential returns. However, all of the funds launched with upside caps over 40%, offering the kind of growth that you’d expect from bitcoin exposure.
Laddering a selection of Protected Bitcoin ETFs may pay off when considering how bitcoin’s price swings can work. All four funds within CBTL’s portfolio have outcome periods, giving investors access to different time horizons and bitcoin growth opportunities. This laddered layout could also separate some of the drawdown impact from the rest of the portfolio. When combined with the fund’s inherent focus on downside security, this gives CBTL risk management benefits while enabling its investors to capitalize on bitcoin rallies.
For more news, information, and strategy, visit the Crypto Content Hub.
Before investing, carefully consider the Fund’s investment objectives, risks, charges and expenses. Please see the prospectus and summary prospectus containing this and other information which can be obtained by calling 1-866-363-9219. Read it carefully before investing.
An investment in the Fund is subject to risks, and you could lose money on your investment in the Fund. There can be no assurance that the Fund will achieve its investment objective. Your investment in the Fund is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. The risks associated with an investment in the Fund can increase during times of significant market volatility. The Fund also has specific principal risks, which are described below. More detailed information regarding these risks can be found in the Fund’s prospectus.
Investing involves risks. Loss of principal is possible. The Fund(s) face numerous market trading risks, including authorized participation concentration risk, cap change risk, capital protection risk, capped upside risk, cash holdings risk, clearing member default risk, correlation risk, derivatives risk, equity securities risk, investment timing risk, large-capitalization investing risk, liquidity risk, market maker risk, market risk, non- diversification risk, options risk, premium-discount risk, secondary market trading risk, sector risk, tax risk, trading issues risk, underlying ETF risk and valuation risk. For a detailed list of fund risks see the prospectus.
FUND-OF-FUNDS RISK. Shareholders of the Fund will experience investment returns that are different than the investment returns provided by an Underlying ETF. The Fund does not itself pursue a defined outcome strategy, nor does the Fund itself provide downside protection against SPY losses. Because the Fund will typically not purchase an Underlying ETF on the first day of a Target Outcome Period, it is not likely that the stated outcome of the Underlying ETF will be realized by the Fund. The Fund will be continuously exposed to the investment profiles of each of the Underlying ETFs during their respective Target Outcome Periods. The Fund, with its aggregate exposure to each of the Underlying ETFs, may have investment returns that are inferior to that of any single Underlying ETF or group of Underlying ETFs over any given time period. In between the semi-annual rebalance period of the Index, because the Fund is not equally weighted on a continuous basis, the Fund may be exposed to one or more Underlying ETFs disproportionately when compared to other Underlying ETFs. In such circumstances, the Fund will be subject to the over-weighted performance of such Underlying ETF. As a shareholder in other ETFs, the Fund bears its proportionate share of each ETF’s expenses, subjecting Fund shareholders to duplicative expenses.
There are no assurances the Underlying ETFs will be successful in providing the sought-after protection. The outcomes that the Underlying ETFs seek to provide may only be realized if you are holding shares on the first day of the outcome period and continue to hold them on the last day of the outcome period, approximately one year. There is no guarantee that the outcomes for an outcome period will be realized or that the Underlying ETFs will achieve its investment objective. If the outcome period has begun and the underlying ETF has increased in value, any appreciation of the Fund(s) by virtue of increases in the underlying ETF since the commencement of the outcome period will not be protected by the sought-after protection, and an investor could experience losses until the underlying ETF returns to the original price at the commencement of the outcome period. The Underlying ETFs are subject to an upside return cap (the “Cap”) that represents the maximum percentage return an investor can achieve from an investment in the fund(s) for the outcome period, before fees and expenses. If the outcome period has begun and the Underlying ETFs have increased in value to a level near to their individual Cap, an investor purchasing at that price has little or no ability to achieve gains but remains vulnerable to downside risks. Additionally, the Cap may rise or fall from one outcome period to the next. Unlike the Underlying ETFs, the Fund itself does not pursue a target outcome strategy. The protection is only provided by the Underlying ETFs and the Fund itself does not provide any stated downside protection against losses. The Fund will likely not receive the full benefit of the Underlying ETF downside protections and could have limited upside potential. The Fund’s returns are limited by the caps of the Underlying ETFs. The Cap, and the Fund(s) position relative to it, should be considered before investing in the Fund(s) website, www.calamos.com, provides important
Fund information as well as information relating to the potential outcomes of an investment in the Fund(s) on a daily basis.
Cap Rate – Maximum percentage return an investor can achieve from an investment in the Fund if held over the Outcome Period.
Protection Level – Amount of protection the Fund is designed to achieve over the Days Remaining. Outcome Period – The defined length of time over which the outcomes are sought.
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