Simplify Volatility Price, Forecast, Insider, Ratings, Fundamentals & Signals

New york--(business wire)--simplify announced today that it expects to deliver capital gains distributions across six simplify etfs.

The Simplify Volatility Premium ETF aims to generate income by selling futures on the CBOE Volatility Index. SVOL has experienced some NAV erosion but has maintained a relatively stable level and outperformed the S&P 500 total return since its inception. The fund has made significant changes to its holdings, reducing exposure to the aggregate bond index and increasing investments in high yield credit, T-Bills, and new-issue mortgages.

Simplify Volatility Premium ETF is a popular income-generating ETF with an yield of 16% by betting against VIX. Many people are concerned that it may not be relevant to "short" VIX when VIX is so low as it is. The fund continues to outperform the overall market in total returns as well as risk-adjusted returns.

SVOL is a complex ETF that uses the volatility index, not stocks, as a primary driver of returns and cash distribution.

SVOL utilizes a volatility selling strategy by selling VIX futures one month out instead of the front month future.

Simplify Volatility Premium ETF receives a buy rating after addressing concerns regarding dividend distributions and underlying holdings changes. Return of capital distributions have ended, signaling a shift in strategy by portfolio managers. SVOL has reduced its holdings of CYA and added VIX call options, improving its position in the market.

SVOL is a well-designed income ETF that hedges out black-swan convexity risk. The ETF sells VIX futures to generate yield, producing a similar income but a superior risk profile to other income ETFs. While we expect the yield to remain solid, the AUM of the strategy may decline in coming weeks and months, potentially impacting absolute returns.

Volatility funds have become popular for gaining exposure to the S&P 500 volatility index, but there are risks involved. The Simplify Volatility Premium ETF offers a different approach to shorting the VIX with a hedging strategy and lower risk exposure. Recent distribution trends and the low VIX make SVOL less attractive for investment at the moment.

Imagine stocks or funds that pay out their dividends once a month! Unlike waiting for quarterly, semi-annual or (ugh) annual payouts, your angst awaiting money is reduced by 300% or more! These December U.S. exchange-traded monthly-paid (MoPay) dividends, upsides, and net gains include: 1. Stocks by yield (79); 2. Stocks by price upside (30); 3. Closed-End-Investments, Exchange-Traded Funds & Notes (CEICs/ETFs/ETNs) by yield >9.5% (80). Items: 1. Top MoPay stock gains; 2. Overall best MoPay gainers; 3. Funds vs. Equities; 4. Fund risks/rewards. All per prices as of 12/8/23.

Recreating Simplify Volatility Premium ETF's strategy using short volatility ETFs is possible and provides us insight into SVOL's potential flaws. ProShares Short VIX Short-Term ETF and Volatility Shares' -1x Short VIX Futures ETF offer investors access to ETF-only portfolio strategies that can provide short volatility exposure. These strategies are unique because they give investors access to gains via capital gains, not current income. The strategies perform wildly different based on varied backtests.

Simplify Volatility Premium ETF has changed its dividend distribution to primarily return of capital distributions, indicating a struggle to meet consistent income targets. My rating has changed to hold over concerns of these RoC distributions continuing moving forward. SVOL has changed its hedging strategy to incorporate the Simplify Tail Risk Strategy ETF, which may introduce additional risks to the fund's strategy and prove as an inefficient hedge.