Buffer ETFs are having a moment as traditional hedges like bonds and gold have struggled to protect portfolios during recent bouts of geopolitical volatility. By using options contracts to shield investors from a set portion of market losses over a fixed outcome period, typically a year.  

The tradeoff appeals specifically to risk averse investors who still want equity market exposure but are willing to give up some gains for a defined safety net. Adoption has been slow among advisors broadly, but issuers have responded with a wider menu of options anyway, launching funds with shorter outcome periods.  

The common thread across all of them is the same basic promise: a known, pre agreed tradeoff between protection and participation, rather than the open ended risk of owning the market outright. 

Finsum: As bonds and gold have failed to reliably cushion recent selloffs, buffer ETFs are drawing renewed interest for offering investors a known.