QJN provides exposure to tech growth stocks with a built-in 10% downside buffer over a one-year period starting each June. You get most of the upside potential (up to a cap) while the fund absorbs the first 10% of losses.
How It Works
The fund uses a options overlay strategy on a tech growth portfolio, buying puts to create the 10% buffer and selling calls to fund the protection. The outcome period resets annually in June, with new caps and buffer levels. Between reset dates, the buffer and cap levels float based on market movements and time decay.
Key Features
- 10% downside buffer absorbs first losses in any June-to-June period
- Tech growth focus rather than broad market exposure like most buffer ETFs
- Annual reset means predictable entry points for full buffer protection
Risks
- Losses beyond 10% hit dollar-for-dollar — a 25% drop means you lose 15%
- Upside cap (typically 15-20%) means missing gains in strong tech rallies
- Mid-period buyers get partial buffer — buy in December, only 5% protection remains
Who Should Own This
Best for tech believers who want to sleep better at night — you're willing to give up some upside to avoid the first 10% drop. Works well for recent retirees with tech exposure they can't stomach selling or anyone who likes growth stocks but hates the volatility. Buy at June reset for maximum protection.