AllianzIM Buffered Outcome ETFs

Institutional risk management for the retail investor

Introducing a new series of ETFs designed to bring our in-house hedging capabilities and track record of managing risk to the retail investor.
Built to help mitigate risk and lower volatility, Buffered Outcome ETFs allow investors to participate in the growth potential of the equity markets up to a stated Cap, with an explicit downside Buffer.

How Buffered Outcome ETFs work

Possible outcomes across four market scenarios

When investing in AllianzIM Buffered Outcome ETFs, there are four possible scenarios for the Outcome Period:

  • Losses exceed the buffer
  • Losses within the buffer
  • Returns within the cap
  • Returns exceeding the cap
useful description of image if informative and not decoration only.

The chart above is a for illustrative purposes only intended to demonstrate hypothetical returns that the Fund seeks to provide where a shareholder holds Shares for the entire Outcome Period. The returns shown in the charts are based on hypothetical performance in certain illustrative scenarios and do not take into account payment by the Fund of fees and expenses, brokerage commissions, trading fees, taxes and non-routine or extraordinary expenses not included in the Fund’s unitary management fee. The deduction of fees and expenses will reduce performance. There is no guarantee that the Fund will be successful in providing these investment outcomes for any Outcome Period. Full extent of Caps and Buffers only apply if held for stated Outcome Period. There is no guarantee that the Cap will remain the same after the end of the Outcome Period. The Cap may increase or decrease and may vary per Series.

Varying levels of risk mitigation

SecureSecure
10% Buffer Strategy
SecureSecure
20% Buffer Strategy

Product Table
(GrossMore info
Excludes fees and expenses yet to be incurred.
 / NetMore info
Includes fees and expenses yet to be incurred.
)
As of 11/27/2020 02:07:52 PM EST

List of companies and their prices.
Column one contains the official codes used in financial markets.
Ticker
Strategy 
Series  
ETF
Price
More info
ETF Bid/Ask Midpoint, as of the current timestamp.
ETF
Return
More info
Return since the beginning of the Outcome Period.
Reference Asset
Reference
Asset
Return
More info
Return since the beginning of the Outcome Period.
Remaining 
Cap
More info
Maximum potential return the ETF seeks to provide for the Outcome Period.
Remaining 
Buffer
More info
Maximum potential loss reduction the ETF seeks to provide for the Outcome Period.
Downside
Before
Buffer
More info
Maximum potential loss the ETF seeks to incur before benefitting from the Buffer for the Remaining Outcome Period, as of the current timestamp.
Remaining
Outcome
Period
More info
Period of time over which the ETF seeks to provide Starting Value outcomes, including Cap and Buffer.
AZAA U.S. Large Cap 10% Buffer April $27.21 8.83% S&P 500 Price Return Index 19.51% 1.63% /
1.38%
16.58% /
16.33%
-8.11% /
-8.36%
125 Days
AZBA U.S. Large Cap 20% Buffer April $26.23 4.93% S&P 500 Price Return Index 19.51% 0.46% /
0.21%
28.37% /
28.11%
-4.70% /
-4.95%
125 Days
AZAL U.S. Large Cap 10% Buffer July $27.49 9.94% S&P 500 Price Return Index 17.36% 5.60% /
5.17%
14.27% /
13.83%
-9.04% /
-9.48%
216 Days
AZBL U.S. Large Cap 20% Buffer July $26.44 5.74% S&P 500 Price Return Index 17.36% 2.89% /
2.46%
26.40% /
25.96%
-5.43% /
-5.87%
216 Days
AZAO U.S. Large Cap 10% Buffer October $26.37 5.46% S&P 500 Price Return Index 8.19% 10.28% /
9.65%
11.63% /
11.01%
-5.18% /
-5.80%
308 Days
AZBO U.S. Large Cap 20% Buffer October $25.79 3.14% S&P 500 Price Return Index 8.19% 5.29% /
4.67%
23.01% /
22.39%
-3.04% /
-3.67%
308 Days

What would it take to rebuild your assets after a market drop?

The larger the loss, the greater the gain it takes to rebuild back to the original value. But with AllianzIM Buffered Outcome ETFs, you may not have to overcome as much to break even.

To demonstrate, let’s look at “the arithmetic of loss” for a variety of hypothetical market scenarios and what return you would need to break even with the first 10% or 20% of losses buffered.

This hypothetical example is for illustrative purposes only and is meant to demonstrate the effect of negative performance on a portfolio and the subsequent positive performance needed to break even. This does not represent any historical index data or investments. There is no guarantee that the Fund will be successful in providing these investment outcomes for any Outcome Period. Despite the intended Buffer, a shareholder who holds Shares for an entire Outcome Period could lose their entire investment.

In certain products, you may not be able to participate fully in a market recovery due to the capped upside potential of subsequent periods.

List of hypothetical portfolio losses.
Column one contains the hypothetical percent drop.
If your
portfolio loses
You would need
this overall return
to break even
If you had a
10% Buffer
If you had a
20% Buffer
5% 5.26% 0.00% 0.00%
10% 11.11% 0.00% 0.00%
15% 17.65% 5.26% 0.00%
20% 25.00% 11.11% 0.00%
25% 33.33% 17.65% 5.26%
30% 42.86% 25.00% 11.11%
35% 53.85% 33.33% 17.65%
40% 66.67% 42.26% 25.00%
45% 81.82% 53.85% 33.33%
50% 100.00% 66.67% 42.86%

This hypothetical example is for illustrative purposes only and is meant to demonstrate the effect of negative performance on a portfolio and the subsequent positive performance needed to break even. This does not represent any historical index data or investments. This hypothetical chart does not reflect the deduction of fees and expenses, which would reduce performance. There is no guarantee that the Fund will be successful in providing these investment outcomes for any Outcome Period. Despite the intended Buffer, a shareholder who holds Shares for an entire Outcome Period could lose their entire investment. You may not be able to participate fully in a market recovery due to the capped upside potential in subsequent index periods.

Implementation Ideas

Investor Use Cases

Help reduce volatility

Use case 1 - Help de-risk equity position

Reposition a portion of domestic equity exposure to potentially help:

  • Provide a limit to reduce downside risk/volatility with the Buffer
  • Maintain a level of equity upside up to a Cap
ETF Buffered pie 1

Help increase market potential

Use case 2 - Diversify traditional allocation

Reposition a proportionate share of a balanced portfolio to potentially help:

  • Increase upside potential up to a Cap
  • Preserve risk targets

ETF Buffered pie 2

The Funds seek to deliver returns that match, at the end of a specified one-year period (Outcome Period) the returns of the S&P 500 Price Index up to a predetermined Cap, while limiting downside losses by the amount of a specified Buffer, before fees and expenses. There is no guarantee the funds will achieve their investment objectives. You may lose your entire investment, regardless of when you purchase shares, and even if you hold shares for an entire Outcome Period. The Fund may not be suitable for all investors.

Investing involves risk including possible loss of principal. Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus with this and other information about the Fund, please call 877.429.3837 or download and review the prospectus. Read the prospectus carefully before investing.

Allianz Investment Management LLC serves as the ETFs’ investment adviser.

To achieve the target outcomes sought by the Fund for an Outcome Period, an investor must hold Fund Shares for that entire Outcome Period. An investor that purchases Fund Shares after the Outcome Period has begun or sells Fund Shares prior to the end of the Outcome Period may experience results that are very different from the investment objective sought by the Fund for that Outcome Period. For example, if the Outcome Period has begun and the Fund has increased in value to a level near to the Cap, an investor purchasing at that price has little or no ability to achieve gains but remains vulnerable to downside risks. Alternatively, if the Outcome Period has begun and the Fund has decreased in value beyond the starting 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.

In the event that the S&P 500 Price Index has gains in excess of the Cap for the Outcome Period, the Fund will not participate in those gains beyond the Cap. Despite the intended Buffer, a shareholder could lose their entire investment. An investment in the Fund is only appropriate for shareholders willing to bear those losses. The Cap and Buffer, and the Fund’s position relative to each, should be considered before investing in the Fund.

FLEX Options Risk. The Fund will utilize FLEX Options issued and guaranteed for settlement by the Options Clearing Corporation (“OCC”). The Fund bears the risk that the OCC will be unable or unwilling to perform its obligations under the FLEX Options contracts. In the unlikely event that the OCC becomes insolvent or is otherwise unable to meet its settlement obligations, the Fund could suffer significant losses.

FLEX Options are customized equity or index options contracts that trade on an exchange, but provide investors with the ability to customize key contract terms like exercise prices, styles and expiration dates. An options contract is an agreement between a buyer and seller that gives the purchaser of the option the right, but not the obligation, to buy (in the case of a call option), or to sell (in the case of a put option), a particular asset at a specified future date at an agreed upon price (commonly known as the “strike price”).

The Funds are classified as non-diversified and may invest a relatively high percentage of its assets in a limited number of issuers.

In addition to the risks listed above, the Funds also include buffered loss risk, capped upside return risk, upside participation risk, correlation risk, cap change risk, outcome period risk, downside risk, counterparty risk, valuation risk, liquidity risk, tax risk, market risk, large-cap companies risk, management risk, large shareholder risk, active markets risk, operational risk, authorized participant concentration risk, derivatives risk, ETF risks, cash transactions risk, trading issues risk and market maker risk.

Shares of the Fund trade on the Exchange at market prices that may be below, at or above the Fund’s NAV. The market prices of the Shares generally will fluctuate in accordance with changes in NAV, as well as the relative supply of and demand for Shares on the Exchange. Brokerage commission will reduce returns.

Allianz Investment Management LLC (AllianzIM) is a registered investment adviser and wholly-owned subsidiary of Allianz Life Insurance Company of North America.

Distributed by Foreside Fund Services, LLC.