The Best EFT Diversification for Your Investment Strategy

Money Tree Investing

Money Tree Investing Podcast

Stockmarket, Valuestocks, Investing, Finance, Passiveincome, Wealth, Business, Personalfinance

4.6 • 658 Ratings

🗓️ 14 February 2025

⏱️ 69 minutes

🔗️ Recording | iTunes | RSS

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Summary

Graham Day joins us to talk about the best EFT diversification you can have in your investment portfolio. Graham shares his experience in the ETF world, from his start at PowerShares in 2008 to co-founding Innovator ETFs in 2017.

Innovator introduced defined outcome ETFs, giving investors structured returns with protection against losses that were once only for the rich or through pricey products. They developed buffer ETFs, which limit potential gains but provide set protection against downturns, helping manage risk while keeping investments easy to sell and tax-friendly.

The conversation looks at how these ETFs stack up against traditional financial products, their use in managing investment portfolios, and more.

Today we discuss...

Graham Day shares his background in ETFs, starting at PowerShares and later co-founding Innovator.
Innovator aims to make structured investment strategies more accessible through ETFs.
Defined outcome ETFs provide equity market exposure with downside protection.
Buffer ETFs rebalance annually without creating taxable events.
Innovator also offers accelerated ETFs, which provide leveraged upside with downside limits.
Simplicity is key—structured products are often complex and difficult for advisors and clients to understand.
Innovator ETFs aim to provide strategic, risk-managed solutions that fit into modern portfolios.
Many advisors have used buffer ETFs as a bond alternative due to known downside protection.
Buffer ETFs performed well compared to both bonds and stocks in recent years.
Active management underperforms long-term, with 95% of managers lagging the S&P 500 over a decade.
Investors often underperform the market due to poor timing and emotional decision-making.
Buffer ETFs help investors stay invested by reducing the fear of market downturns.
Some investors allocate 20-25% of portfolios to buffer ETFs for meaningful impact.
Market predictions are unreliable, making defined-outcome strategies appealing.
Innovator aims to provide certainty in an uncertain investing environment.

For more information, visit the show notes at https://moneytreepodcast.com/best-eft-diversification-graham-day-686

Today's Panelists:

Kirk Chisholm | Innovative Wealth
Barbara Friedberg | Barbara Friedberg Personal Finance
Phil Weiss | Apprise Wealth Management

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Transcript

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0:00.0	Welcome to the Money Tree Investing Podcast.
0:04.0	Stock market, wealth, personal finance, value stocks, invest in your life.
0:10.0	Hello, Smart Money Tree Podcasts listeners. Welcome to this week's show. My name is Kirk Chisholm and I'll be your host.
0:15.0	So today I'm joining with Graham Day. How are you today, Graham?
0:19.0	I'm doing great. How are you, Kirk? Doing great. Well, glad to having the show. I'm excited.
0:23.2	I've been looking forward to having this conversation for a while and listeners understand why.
0:27.3	But Graham, tell us a bit about your background.
0:28.7	So I had the opportunity to get into the ETF industry early on. I had a firm that at the time was called Power Shares
0:36.8	ETFs back in 2008, 2009, and
0:42.5	really set the trajectory for my career, was there for about six years, went to another
0:49.0	ETF startup for three years, and then was contacted by my first boss of PowerShares, an individual named
0:55.7	John Southerd, who was one of the co-founders of Power Shares. And he said he was looking at
1:00.8	starting something new. It was intriguing and ultimately made the jump over to Innovator at the
1:08.3	beginning. So back in 2017, and then been able to work with John and his partner
1:15.6	Bruce Bond, our CEO, ever since. You know, it's been pretty exciting. Really, what we're trying
1:22.9	to do at Innovator is to take payoffs that have just never been available in the ETF wrapper and
1:29.0	make them available to advisors, advisors, their clients, and give them some of these payoffs that
1:36.7	maybe were in more expensive wrappers in the past or just you had to be an ultra-high net worth
1:41.8	individual to access them or just for advisors that don't use
1:46.6	those types of products. When you put in the ETF wrapper, there's a lot of value that it provides
1:51.9	them. And so we've had, I've been very fortunate to have a tremendous adoption of these defined
1:59.2	outcome ETFs, these buffer ETFs. And the firm has now,
	...

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