Protected Bitcoin ETFs are emerging as a compelling solution for investors seeking exposure to cryptocurrency while mitigating downside risks. Calamos Investments, a pioneer in alternatives and options-based strategies, has introduced a suite of protected Bitcoin ETFs tailored for advisors and risk-conscious clients.
Calamos Investments: A Legacy of Alternative Strategies
Founded by John Calamos in the 1970s, Calamos Investments built its reputation on options-based risk management. Today, the firm manages over $16 billion in alternatives, primarily through options-related strategies—including its innovative protected Bitcoin ETFs.
Why Options-Based ETFs Are Gaining Traction
Recent demand for downside-protected ETFs reflects market volatility and investor caution. Matt Kaufman, SVP of ETFs at Calamos, notes:
"Nearly 100% of advisors are asked about Bitcoin. We’re in early innings of integrating crypto into portfolios."
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Calamos Protected Bitcoin ETF Suite
Calamos offers three tiers of downside protection, each with a one-year outcome period:
1. Calamos Bitcoin 80 Series (CBTA)
- 80% downside protection
- Caps losses at 20% (pre-fees) even if Bitcoin drops >20%.
- Tracks gains up to a predefined cap.
2. Calamos Bitcoin 90 Series (CBXA)
- 90% downside protection
- Limits losses to 10% (pre-fees) if Bitcoin declines 10–100%.
3. Calamos Bitcoin 100 Series (CBOA)
- 100% downside protection
- Zero loss exposure; upside capped at a set limit.
Key Considerations for Advisors
- Capped Upside: Participation in Bitcoin’s gains is limited to predefined thresholds.
Outcome Periods: Returns vary if shares are traded mid-period. Kaufman observes:
"Half of investors hold for the full outcome; others trade opportunistically."
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FAQs
1. How do Calamos ETFs protect against losses?
They use options contracts to buffer declines—80%, 90%, or 100%—over one year.
2. Are these ETFs suitable for long-term crypto exposure?
No. They’re structured products with defined outcome periods (1 year).
3. What fees apply?
Expense ratios and cap rates reduce net returns. Review prospectuses for details.
4. Can investors exit before the outcome period?
Yes, but mid-period trading may result in divergent returns.
Bottom Line
Calamos’s ETFs provide a risk-managed gateway to Bitcoin, ideal for clients who:
- Seek crypto exposure without full volatility.
- Prioritize capital preservation.
For advisors, these products offer a structured alternative to direct crypto investments—balancing growth potential with measurable downside control.