A traditional option or structured note purchased at a single point in time may lead to a market timing risk. Our indexes enter and exit defined outcome investments throughout the year.
Let’s look at an example using our Hedge solution, which targets provides protection against the first 10% market loss.
Imagine the market rapidly declines after the purchase of a hedged investment. Investors could quickly run out of protection and have little to no protection for the rest of the investment’s term if there was a single point in time purchase.
Exceed Indexes solve this problem by tracking new investments throughout the year, which provides the opportunity for more consistent portfolio returns. Thus, defined outcome investment holdings for each Exceed Index will look something like this during the course of a year: