YETH offers exposure to ether*, subject to a
cap, while seeking to generate monthly options income.
NEW
YORK, Sept. 4, 2024 /PRNewswire/ -- Roundhill
Investments, an ETF sponsor focused on innovative financial
products, is pleased to announce the launch of the Roundhill Ether
Covered Call Strategy ETF (YETH), which begins trading on Cboe BZX
today.
YETH seeks to offer investors exposure to ether*, the world's
second largest cryptocurrency by market
capitalization. The Ethereum blockchain is the
backbone for many emerging technologies,
including DeFi, NFTs, and
decentralized applications.
The Roundhill Ether Covered Call Strategy ETF employs a covered
call strategy on ether-tracking ETFs, designed to generate
potential monthly income while providing investors with exposure to
the price movements of ether (subject to an upside cap).
Historically, ether has exhibited slightly higher volatility
compared to bitcoin, which may translate into higher
option premiums. While many investors in the spot ETH
market stake their coins to earn a staking yield, the currently
offered spot ETPs do not offer yields. YETH, however, provides
potential income generation through its covered call strategy,
offering an alternative for investors.
In addition to YETH, the firm launched the Roundhill
Bitcoin Covered Call Strategy ETF (YBTC) in January of
this year. Following the successful launch of YETH, Roundhill is
proud to have officially become the first U.S. ETF issuer to offer
income-oriented strategies across both bitcoin and
ether, the world's two largest cryptocurrencies.
"YETH offers investors an attractive blend of high income
potential and exposure to ether," said Dave
Mazza, Chief Strategy Officer at Roundhill Investments.
"Investors have clamored for a covered call ETF with exposure to
ether and we are proud to bring such a product to the U.S.
market."
*The Fund does not invest directly in ether. The Fund
does not invest in, or seek direct exposure to, the current "spot"
or cash price of ether. Investors seeking direct exposure to the
price of ether should consider an investment other than the Fund.
The fund seeks to provide exposure to the price return of an
exchange-traded fund that invests principally in ether futures
contracts (the "Ether Futures ETF"). The fund is not suitable for
all investors and involves a high degree of risk.
About Roundhill Investments:
Founded in 2018, Roundhill Investments is an SEC-registered
investment advisor focused on innovative exchange-traded funds.
Roundhill's suite of ETFs offers distinct and differentiated
exposures across thematic equity, options income, and trading
vehicles. Roundhill offers a depth of ETF knowledge and experience,
as the team has collectively launched more than 100+ ETFs including
several first-to-market products. To learn more about the company,
please visit roundhillinvestments.com.
Investors should consider the investment objectives, risks,
charges, and expenses carefully before investing. For a prospectus
or summary prospectus, if available, with this and other
information about the Fund, please call 1-855-561-5728 or visit our
website
https://www.roundhillinvestments.com/etf/YETH. Read the
prospectus or summary prospectus carefully before
investing.
All investing involves risk, including the risk of loss of
principal. There is no guarantee the investment strategy will be
successful. For a detailed list of fund risks see the
prospectus.
Ether Futures ETF Risks. The Ether Futures ETFs do not invest
directly in ether. Accordingly, the performance of an Ether
Futures ETF should not be expected to match the performance of
ether. The Fund will have significant exposure to an Ether Futures
ETF through its options positions that utilize an Ether Futures ETF
as the reference asset.
Ether Risk. Ether is a relatively new innovation and the
market for ether is subject to rapid price swings, changes and
uncertainty. The further development of the Ethereum
network and the acceptance and use of ether are subject to a
variety of factors that are difficult to evaluate. The slowing,
stopping or reversing of the development of the
Ethereum network or the acceptance of ether may
adversely affect the price of ether. Ether is subject to the risk
of fraud, theft, manipulation or security failures,
operational or other problems that impact the digital asset trading
venues on which ether trades. The Ethereum blockchain,
including the smart contracts running on the Ethereum
blockchain, may contain flaws that can be exploited by hackers. A
significant portion of ether is held by a small number of holders
sometimes referred to as "whales." Transactions of these holders
may manipulate the price of ether.
Unlike the exchanges for more traditional assets, such as equity
securities and futures contracts, ether and the digital asset
trading venues on which it trades are largely unregulated or may be
operating out of compliance with applicable regulation. As a
result, individuals or groups may engage in fraud or
market manipulation (including using social media to promote ether
in a way that artificially increases the price of ether). Investors
may be more exposed to the risk of theft, fraud and
market manipulation than when investing in more traditional asset
classes.
Ether Futures Risk. The market for ether futures
contracts may be less developed, and potentially less liquid and
more volatile, than more established futures markets.
Futures Contract Risk. Risks of futures contracts
include: (i) an imperfect correlation between the value of the
futures contract and the underlying asset; (ii) possible lack of a
liquid secondary market; (iii) the inability to close a futures
contract when desired; (iv) losses caused by unanticipated market
movements, which may be unlimited; (v) an obligation for an Ether
Futures ETF to make daily cash payments to maintain its required
margin, particularly at times when an Ether Futures ETF may have
insufficient cash; and (vi) unfavorable execution prices from rapid
selling. Unlike equities, which typically entitle the holder to a
continuing stake in a corporation, futures contracts normally
specify a certain date for settlement in cash based on the
reference asset.
Covered Call Strategy Risk. A covered call strategy
involves writing (selling) covered call options in return for the
receipt of premiums. The seller of the option gives up the
opportunity to benefit from price increases in the underlying
instrument above the exercise price of the options, but continues
to bear the risk of underlying instrument price declines. The
premiums received from the options may not be sufficient to offset
any losses sustained from underlying instrument price declines,
over time. As a result, the risks associated with writing covered
call options may be similar to the risks associated with writing
put options. Exchanges may suspend the trading of options during
periods of abnormal market volatility. Suspension of trading may
mean that an option seller is unable to sell options at a time that
may be desirable or advantageous to do.
Flex Options Risk. Trading FLEX Options involves risks
different from, or possibly greater than, the risks associated with
investing directly in securities. The Fund may experience losses
from specific FLEX Option positions and certain FLEX Option
positions may expire worthless. The FLEX Options are listed on an
exchange; however, no one can guarantee that a liquid secondary
trading market will exist for the FLEX Options. In the event that
trading in the FLEX Options is limited or absent, the value of the
Fund's FLEX Options may decrease. In a less liquid market for the
FLEX Options, liquidating the FLEX Options may require the payment
of a premium (for written FLEX Options) or acceptance of a
discounted price (for purchased FLEX Options) and may take longer
to complete. A less liquid trading market may adversely impact the
value of the FLEX Options and Fund shares and result in the Fund
being unable to achieve its investment objective. Less liquidity in
the trading of the Fund's FLEX Options could have an impact on the
prices paid or received by the Fund for the FLEX Options in
connection with creations and redemptions of the Fund's shares.
Depending on the nature of this impact to pricing, the Fund may be
forced to pay more for redemptions (or receive less for creations)
than the price at which it currently values the FLEX Options. Such
overpayment or under collection could reduce the Fund's ability to
achieve its investment objective. Additionally, in a less liquid
market for the FLEX Options, the liquidation of a large number of
options may more significantly impact the price. A less liquid
trading market may adversely impact the value of the FLEX Options
and the value of your investment. The trading in FLEX Options may
be less deep and liquid than the market for certain other
exchange-traded options, non-customized options or other
securities.
Counterparty Risk. Fund transactions involving a
counterparty are subject to the risk that the counterparty will not
fulfill its obligation to the Fund. Counterparty risk may arise
because of the counterparty's financial condition (i.e., financial
difficulties, bankruptcy, or insolvency), market activities and
developments, or other reasons, whether foreseen or not. A
counterparty's inability to fulfill its obligation may result in
significant financial loss to the Fund. The Fund may be unable to
recover its investment from the counterparty or may obtain a
limited recovery, and/or recovery may be delayed.
New Fund Risk. The fund is new and has a limited
operating history.
Concentration Risk. The Fund may be susceptible to
an increased risk of loss, including losses due to adverse events
that affect the Fund's investments more than the market as a whole,
to the extent that the Fund's investments are concentrated in
investments that provide exposure to ether.
Non-Diversification Risk. As a "non-diversified"
fund, the Fund may hold a smaller number of portfolio securities
than many other funds. To the extent the Fund invests in a
relatively small number of issuers, a decline in the market value
of a particular security held by the Fund may affect its value more
than if it invested in a larger number of issuers. The value of the
Fund Shares may be more volatile than the values of shares of more
diversified funds.
Roundhill Financial Inc. serves as the investment advisor. The
Funds are distributed by Foreside Fund Services, LLC which is not
affiliated with Roundhill Financial Inc., U.S. Bank, or any of
their affiliates.
Glossary
Options: An option is a contract sold by one party
to another that gives the buyer the right, but not the obligation,
to buy (call) or sell (put) a stock at an agreed upon price within
a certain period or on a specific date.
Covered Call Strategy: A covered call strategy involves
writing (selling) covered call options in return for the receipt of
premiums. The seller of the option gives up the opportunity to
benefit from price increases in the underlying instrument above the
exercise price of the options, but continues to bear the risk of
underlying instrument price declines.
Out-of-the-Money Options: Out-of-the-money options
are options whose strike price is above the market price of the
underlying asset.
Notional Exposure: The total value controlled by the
Fund's portfolio of option contracts. Notional exposure is
calculated by multiplying the number of contracts held by the
underlying index price and multiplying this product by the contract
multiplier of $100.
Strike: The price at which an owner of a call (put)
option has the right, but not the obligation, to purchase (sell) a
stock for at the time of the option's expiration.
Upside: Reflects the degree of upside potential that
could be experienced by a reference asset, expressed as a
percentage, before it moves above the strike price of an associated
short call option. The likelihood that the short call option will
be exercised effectively creates a cap on potential gains.
Expiration Date: The last date that an option contract is
valid before it expires and ceases to exist.
Days to Expiry: The number of calendar days until an
option contract's expiration date.
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SOURCE Roundhill Investments
