Newcomer Liquid Strategies lists put spread ETFs

Liquid Strategies, Georgia-based mutual fund provider, is entering the ETF industry, listing a suite of put spread equity ETFs.

  • Overlay Shares Core Bond ETF (OVB)
  • Overlay Shares Foreign Equity ETF (OVF)
  • Overlay Shares Large Cap Equity ETF (OVL)
  • Overlay Shares Municipal Bond ETF (OVM)
  • Overlay Shares Small Cap Equity ETF (OVS)

All funds get their equity exposure by investing in cheap liquid ETFs. So for instance, OVL will buy IVV, VOO or SPY to get US large cap exposure. The funds then buy and sell put options at different strike prices to create a spread.

The sale of the put options and dividends from the underlying ETFs generates yield. However the fund can get putted to and purchasing puts can create performance drag.