Improve Your Buffer ETF Portfolio with This Trick!

Watch the full buffer ETF series:
Pt. 1:    • Brilliant Protection or Hidden Trap? | Buf...  
Pt. 2:    • The Problem with Buffer ETFs  

Buffer ETFs have quickly become one of the fastest-growing product lines in finance, with over $5B in inflows during Q1 2025. But while they offer appealing downside protection, investors often overlook two major problems: vulnerability to sudden market crashes and capped upside returns.

In this episode, we discuss:
• Why buffer ETFs do not fully address left-tail risk during sharp crashes
• The potential dangers of capped right-tail returns in strong bull markets
• Portfolio-level strategies to complement buffers, including tail hedging, trend following, QMJ, and anti-beta approaches
• A simple equity-and-cash combination that can approximate buffer ETF returns
• Practical ways investors can build more resilient, cost-efficient portfolios

Timestamps
0:00 – Intro/ The problem with Buffer ETFs
1:57 – The fast crash problem: Hedge your tail!
3:48 – Alternative tail hedging strategies
4:34 – The right tail problem: a SIMPLE solution
4:52 – Replicating buffer ETF strategies... and a backtest!
5:33 – Outro/ A portfolio construction primer

Sources
ETFAction – @etfAction on X.
AQR Paper: Rebuffed: A Closer Look at Options-Based Strategies (2025) by Cliff Asness and Daniel Villalon – https://www.aqr.com/Insights/Perspect...

Subscribe for more insights on diversification, market trends, and smart investing strategies!

For more educational resources, visit:
https://www.alphaarchitect.com
Disclosures:
https://www.alphaarchitect.com/disclo...