The FLEX Options Custom Target Outcome ETF (FOCT) is managed under normal market conditions by investing substantially all of its assets in Flexible Exchange® Options (FLEX Options) that reference the price performance of the SPDR® S&P 500® ETF Trust (the Underlying ETF). FLEX Options are specialized equity or index option contracts that trade on exchanges and offer customizable terms such as exercise prices and expiration dates. The Underlying ETF, sponsored by PDR Services, LLC, replicates the performance of the S&P 500® Index, providing investors with exposure to a diversified basket of large-cap U.S. stocks. FOCT employs a target outcome strategy using FLEX Options, aiming to offer investors a predetermined investment outcome based on the Underlying ETF's price performance over a specific period. This strategy includes a buffer against the first 10% of Underlying ETF losses and a cap of 27.12% (before fees and expenses) for the current Target Outcome Period, allowing investors to potentially benefit from market gains while managing downside risk. The Fund's cap and buffer levels are adjusted at the beginning of each Target Outcome Period to reflect prevailing market conditions.
The First Trust Octagon 10/40 ETF (FOCT) may not be primarily focused on dividends, but it does distribute dividends in accordance with the performance of its underlying index. These dividend distributions typically occur on a regular basis, often quarterly, and are subject to the dividend policies of the individual companies within the Octagon 10/40 Index. As FOCT includes a diverse range of large-cap U.S. companies, investors can potentially benefit from both capital appreciation and some level of dividend income as part of their investment strategy.
FOCT, or the FT Cboe Vest US Equity Buffer ETF - October, employs a unique investment strategy centered on Flexible Exchange® Options (FLEX Options) tied to the performance of the SPDR® S&P 500® ETF Trust (the Underlying ETF) under normal market conditions. FLEX Options allow for customization of key contract terms like exercise prices and expiration dates. The Underlying ETF mirrors the S&P 500® Index by investing in as many of its constituent stocks as possible. FOCT utilizes FLEX Options to pursue a target outcome strategy aimed at achieving predetermined investment outcomes based on the Underlying ETF's performance over approximately one year. These outcomes include a buffer against the first 10% of Underlying ETF losses and a cap on potential gains, adjusted to prevailing market conditions. Investors should carefully consider these features and the Fund's unique investment approach before investing.
The correlation aspect of the [FLEX Options Customization Technology (FOCT) plays a crucial role in understanding its behavior in relation to the broader U.S. equity market. Since FOCT primarily invests in FLEX Options referencing the price performance of the SPDR® S&P 500® ETF Trust, its correlation with the S&P 500 Index is expected to be influenced by the performance of these options. While the specific correlation details may vary, investors interested in FOCT's performance in relation to the broader market can use our tool ETF Insider to study correlations, gain deep insights, and visualize data, helping them make informed investment decisions. ETF Insider offers valuable information on how FOCT's correlation may affect their portfolio diversification and risk management strategies.
The FLEX Options Customization Technology (FOCT) ETF is primarily focused on providing investors with tailored options strategies based on the price performance of the SPDR® S&P 500® ETF Trust (SPY). This sector specializes in using FLEX Options to employ a target outcome strategy that aims to offer a buffer against the first 10% of SPY losses while capping potential gains. Investors interested in flexible and customized options strategies tied to the S&P 500® Index may find this sector appealing, but it's important to note that the investment outcomes are subject to market conditions and specific strategy parameters.
The exposure characteristic of the First Trust Octagon Small Cap Technology ETF (FOCT) revolves around the small-cap technology sector within the U.S. equity market. FOCT aims to capture the growth potential inherent in smaller technology companies, offering investors an opportunity to participate in this dynamic and innovative segment. For a detailed breakdown of FOCT's exposure, including sectoral allocation, regional focus, and correlations, investors can leverage the ETF Insider web app, which provides comprehensive data and visualization tools for a deeper understanding of this ETF and its place in their investment strategy.
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5 min readThe FOCT ETF is a specialized investment fund that focuses on global companies in the relevant sectors. This exchange-traded fund offers investors exposure to a diverse range of innovative and cutting-edge companies engaged in advancements in the industry. Discover the potential growth opportunities and risks associated with investing in this dynamic sector through the FOCT ETF.
ETF Insider is a novel portfolio optimization tool that uses the power of data visualization to gain insight into portfolio compositions, concentration risks, portfolio efficiency and more. Complex financial data can be transformed into visually appealing and easily digestible graphs and charts, allowing investors to quickly identify trends and make well-informed investment decisions. Not only does this save time, but it also increases the accuracy and effectiveness of portfolio management.
