Amplify's "Three-in-One" ETF Strategies for Uncertain Markets
Equity investors historically rely on price appreciation for the majority of their returns, but what if equity market prices unexpectedly are flat or even decline for a period of time?
Amplify ETFs offers a suite of equity ETFs that derive their total returns from not one but three sources: price, dividends and option income.
This diversified return approach can help these ETFs perform better compared to equity ETFs with a singular focus on price appreciation during unexpected market downturns or sideways periods.
TOTAL RETURN DYNAMICS: WHY MULTI-SOURCE TOTAL RETURN IN ANY MARKET
As shown below, market conditions and volatility typically impacts total returns, highlighting the need for diverse return strategies to mitigate risk and help capitalize on fluctuations. Utilizing three income streams—price appreciation, dividends, and option income—can boost performance potential, especially in volatile markets. Option income generally rises with volatility, helping to buffer against negative price movements and typically offering a more resilient return profile.
 Bull Market |
Low | Positive Return | Positive Price + Dividends + Option Income |
 Flat Market |
Moderate | Flat Return | Flat Price + Dividends + Increasing Option Income |
 Bear Market |
High | Negative Return | Negative Price + Dividends + Higher Option Income |
DISCOVER AMPLIFY ETFS WITH THREE SOURCES OF TOTAL RETURN
- Amplify CWP Enhanced Dividend Income ETF (DIVO): US high quality dividend paying equities plus tactical option income
- Amplify CWP International Enhanced Dividend Income ETF (IDVO): International high quality dividend paying equities plus tactical option income
- Amplify CWP Growth & Income ETF (QDVO): Growth, high income, and risk-adjusted strategy using tactical covered call options
AMPLIFY ETFS COVERED CALL ETF SUITE
| Primary Goal | Capital appreciation & current income | Current income & capital appreciation | Capital appreciation & high current Income | High current income |
| Distribution Frequency | Monthly | Monthly | Monthly | Monthly |
| Style | Actively Managed | Actively Managed | Actively Managed | Actively Managed |
| Covered Call Strategy— Out of the Money (OTM) |
Monthly or shorter 5-6% |
Monthly or shorter 5-6% |
Monthly or shorter 6-8% |
Monthly 3-5% |
| Avg. % of Portfolio Covered | 20-30% | 30-60% | 30-50% | 80-100% |
| Target Annual Income Distribution | Option Premium: 2-4% Dividend Income: 2-3% |
Option Premium: 2-4% Dividend Income 3-4% |
Option Premium: 4-6% Dividend Income 0-2% |
Option Premium 10%+ Dividend Income 2-3% |
Out of the Money: An out of the money option has a strike price that the underlying security has yet to reach.
Covered call risk is the risk that the Fund will forgo, during the option’s life, the opportunity to profit from increases in the market value of the security covering the call option above the sum of the premium and the strike price of the call, but has retained the risk of loss should the price of the underlying security decline. The Fund currently expects to make distributions on a regular basis, a portion of which may be considered return of capital.