Innovator Expands Defined Protection ETF Suite with AJAN Following Market Demand
The funds only seek to provide their investment objective, which is not guaranteed, over the course of an entire outcome period.
CHICAGO, Jan. 02, 2024 (GLOBE NEWSWIRE) -- Innovator Capital Management, LLC (Innovator), pioneer and provider of the industry’s largest lineup of Defined Outcome ETFs, today announced the launch of seven Defined Outcome ETFs, expanding the firm’s existing lineup. The strategies include six Defined Income ETFs, and the second in its suite of Defined Protection ETFs, which are designed to offer a 100% buffer against loss.
Launching at the start of a new year as investors and advisors are evaluating their portfolios, and as uncertainty for global markets remains high, Innovator’s suite of ETFs is designed to offer exposure to the market’s upside potential while mitigating losses.
Innovator’s newly launched Equity Defined Protection ETF (AJAN) is the second ETF in its suite, following TJUL’s launch in July of 2023. The Defined Protection ETFs are designed to provide investors with market exposure up to a cap, and a 100% buffer against losses in the SPDR S&P 500 ETF, over a two-year outcome period. Unlike many insurance or bank products offering similar exposures, the suite of Defined Protection ETFs are structured without credit risk, while also providing investors with valuable tax efficiency. Innovator intends to launch a new Defined Protection ETF at the start of each calendar quarter over two years, until the suite of eight ETFs is complete.
On the same day, the firm also expanded its existing suite of Defined Income ETFs, launching six new offerings. These strategies are designed to provide investors with a protective barrier or buffer against market losses, while also generating high levels of investment income.
“After the market’s run up at the end of 2023, the idea of locking in gains and putting a buffer in place is one that appeals to many investors. The launch of these new ETFs represents new ways to do just that, and are a continuation of our commitment to provide investors with a wide range of strategies to navigate any market environment,” said Graham Day, CIO at Innovator ETFs. “Given that many of these strategies have historically been locked behind high-fee, tax-inefficient, and illiquid investment structures, we were pleased with the growing receptivity toward our disruptive approach in 2023 and are excited to continue building on that in 2024.”
Innovator is also announcing the starting caps and defined distribution rates for the 18 ETFs resetting in January - the full list of ETFs resetting or listing on January 2 is available below:
| New ETFs | |||||
| Ticker | Name | Ref. Asset | Downside Profile | Outcome Period |
Cap or Defined Dist. Rate* |
| AJAN | Equity Defined Protection | SPY | 100% Buffer | 24 months | 15.81% |
| HJAN | Premium Income 9 Buffer | SPY | 9% Buffer | 12 months | 7.38% |
| LJAN | Premium Income 15 Buffer | SPY | 15% Buffer | 12 months | 6.39% |
| JAND | Premium Income 10 Barrier | SPX | 10% Barrier | 12 months | 8.76% |
| JANH | Premium Income 20 Barrier | SPX | 20% Barrier | 12 months | 7.52% |
| JANJ | Premium Income 30 Barrier | SPX | 30% Barrier | 12 months | 6.40% |
| JANQ | Premium Income 40 Barrier | SPX | 40% Barrier | 12 months | 5.65% |
| Rebalancing ETFs | |||||
| Ticker | Name | Ref. Asset | Downside Profile | Outcome Period | Cap |
| EALT | U.S. Equity 5 to 15 Buffer | SPY | 10% (-5% to -15%) Buffer | 3 months | 6.16% |
| ZALT | U.S. Equity 10 Buffer | SPY | 10% Buffer | 3 months | 3.23% |
| BALT | Defined Wealth Shield | SPY | 20% Buffer | 3 months | 2.56% |
| BJAN | U.S. Equity Buffer | SPY | 9% Buffer | 12 months | 17.99% |
| PJAN | U.S. Equity Power Buffer | SPY | 15% Buffer | 12 months | 14.24% |
| UJAN | U.S. Equity Ultra Buffer | SPY | 30% (-5% to -35%) Buffer | 12 months | 13.94% |
| KJAN | U.S. Small Cap Power Buffer | IWM | 15% Buffer | 12 months | 18.49% |
| NJAN | Growth-100 Power Buffer | QQQ | 15% Buffer | 12 months | 16.09% |
| EJAN | Emerging Markets Power Buffer | EEM | 15% Buffer | 12 months | 16.58% |
| IJAN | Intl Developed Power Buffer | EFA | 15% Buffer | 12 months | 14.98% |
| TFJL | 20+ Year Treasury Bond 5 Floor | TLT | 5% Floor | 3 months | 10.30% |
| TSLH | Hedged TSLA Strategy | Tesla, Inc | 10% Floor | 3 months | 9.49% |
| XBJA | U.S. Equity Accelerated 9 Buffer | SPY | 2x/1x + 9% Buffer | 12 months | 12.70% |
| XDJA | U.S. Equity Accelerated | SPY | 2x/1x | 12 months | 17.20% |
| XTJA | U.S. Equity Accelerated Plus | SPY | 3x/1x | 12 months | 15.87% |
| QTJA | Growth Accelerated Plus | QQQ | 3x/1x | 12 months | 19.32% |
| XDSQ | U.S. Equity Accelerated | SPY | 2x/1x | 3 months | 5.86% |
| XDQQ | Growth Accelerated | QQQ | 2x/1x | 3 months | 7.72% |
The funds have characteristics unlike many other traditional investment products and may not be suitable for all investors. For more information regarding whether an investment in the Funds is right for you, please see “Investor Suitability” in the prospectus.
The funds only seek to provide their investment objective, which is not guaranteed, over the course of an entire outcome period. Investors who purchase shares after or sell shares before the end of an outcome period will experience very different outcomes than the funds seek to provide.
Buffer ETFs
You will bear all reference asset losses exceeding the buffer. Depending upon market conditions at the time of purchase, a shareholder that purchases shares after the Outcome Period has begun may also lose their entire investment. For instance, if the Outcome Period has begun and the Fund has decreased in value beyond the pre-determined buffer, an investor purchasing shares at that price may not benefit from the buffer. Similarly, if the Outcome Period has begun and the Fund has increased in value, an investor purchasing shares at that price may not benefit from the buffer until the Fund's value has decreased to its value at the commencement of the Outcome Period.
The Funds seek to provide shareholders that hold Shares for the entire Outcome Period with a Buffer against the first 9% or 15% of Underlying ETF losses during the Outcome Period. The Funds’ shareholders will bear all Underlying ETF losses exceeding the Buffer on a one-to-one basis. If the Outcome Period has begun and the Funds have decreased in value beyond the pre-determined Buffer, an investor purchasing Shares at that price may not benefit from the Buffer. Similarly, if the Outcome Period has begun and the Funds have increased in value, an investor purchasing Shares at that price may not benefit from the Buffer until the Funds’ values have decreased to their value at the commencement of the Outcome Period.
Income ETFs
The Funds seek to provide shareholders distribution payments (the “Defined Distributions”) that represent a U.S. dollar amount per Share payable by the Fund over an Outcome Period. Defined Distributions are comprised of (i) the income generated by the Fund’s investments in U.S. Treasuries with maturity dates on or about each Distribution Date, the majority with maturities on or about the final Distribution Date at the conclusion of the Outcome Period, and (ii) the premiums generated from the Fund’s FLEX Options positions that expire at the end of each Outcome Period. The Fund will establish an annualized payment rate (the “Defined Distribution Rate”) based upon the Fund’s net asset value (“NAV”) at the commencement of the Outcome Period, which is the percentage of Defined Distributions per Share over the Outcome Period.
These Funds are designed to provide point-to-point exposure to the price return of the Reference Asset via a basket of Flex Options. As a result, the ETFs are not expected to move directly in line with the Reference Asset during the interim period.
Investors purchasing shares after an outcome period has begun may experience very different results than funds’ investment objective. Following the initial outcome period, each subsequent outcome period will begin on the first day of the month the funds were incepted. After the conclusion of an outcome period, another will begin.
The Funds face numerous market trading risks, including active markets risk, authorized participation concentration risk, buffered loss risk, cap change risk, capped upside return risk, correlation risk, liquidity risk, management risk, market maker risk, market risk, non-diversification risk, operation risk, options risk, trading issues risk, upside participation risk and valuation risk. For a detail list of fund risks see the prospectus.
FLEX Options Risk The Funds will utilize FLEX Options issued and guaranteed for settlement by the Options Clearing Corporation (OCC). In the unlikely event that the OCC becomes insolvent or is otherwise unable to meet its settlement obligations, the Fund could suffer significant losses. Additionally, FLEX Options may be less liquid than standard options. In a less liquid market for the FLEX Options, the Fund may have difficulty closing out certain FLEX Options positions at desired times and prices. The values of FLEX Options do not increase or decrease at the same rate as the reference asset and may vary due to factors other than the price of reference asset.
Investing involves risk, including the possible loss of principal.
The Funds’ investment objectives, risks, charges, and expenses should be considered carefully before investing. The prospectus and summary prospectus contain this and other important information, and may be obtained at innovatoretfs.com. Read it carefully before investing.
Innovator ETFs are distributed by Foreside Fund Services, LLC.
Copyright © 2023 Innovator Capital Management, LLC
Media Contact
Frank Taylor / Stephanie Dressler
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