The NUSI ETF retains the pension plans on observe
When it comes to retirement planning, investors often need support here and there. For those who want to do some of the legwork themselves, this is the Nationwide Risk-Managed Income ETF (NYSEArca: NUSI) is a forward looking exchange traded fund.
NUSI can serve as an addition to traditional equity and bond allocations, or as ideal protection for investors with strong exposure to technology and growth stocks. According to Nationwide, the fund is a “rules-based option trading strategy that aims to generate high returns on the Nasdaq 100 index.”
NUSI is one of the few exchange traded funds that offers both income and downside protection under one roof. With the markets seemingly overdue for a correction, NUSI is an important consideration today.
“There are several ways you can estimate how much you could spend each year in retirement. You can use an income planning worksheet to identify your major expenses and project future expenses, ”writes Christine Russell for The Ticker Tape. “Or you can use a general guideline, such as: B. 85% to 90% of your final salary. Of course, the actual amount you need will depend on your lifestyle, financial situation and other factors. “
NUSI: A Prime Income Contributor
NUSI is an actively managed equity portfolio included in the Nasdaq 100 index and an option collar. In accordance with the index rules, the fund only invests in the largest non-financial stocks by market capitalization that are listed on the NASDAQ.
A collar strategy involves selling or writing call options and buying put options, which generates income to hedge against some downside risk. The strategy aims to generate high ongoing income from the dividends received from the underlying stocks and the option premiums withheld.
“The best way to know if you are well on your way to retiring is to identify all the income you are likely to receive in addition to your savings and investments,” says The Ticker Tape. “Most likely, you have social security and possibly a pension or a pension. All three offer the potential for lifetime income, so you may want to use them for essential expenses. Other possible sources of income are maintenance and rental income. Of course, there is no guarantee that these will last a lifetime. “
NUSI pays out in covered calls, not bonds or stock payments.
A covered call refers to an option strategy in which an investor writes or sells a call option on an asset that they already own or have purchased on a stock basis in order to generate income through premiums derived from the sale of the call options . However, the covered call strategy limits the upside and offers limited downside protection. Therefore, it is ideal for investors with a neutral to bullish outlook.
For more information on income strategies, see our Retirement income channel.
The opinions and predictions expressed here are solely those of Tom Lydon and may not actually be fulfilled. Information on this website should not be used or construed as an offer to sell, the solicitation of an offer to buy, or a recommendation for any product.