Lineup includes one Buffered product and four
Fixed Income products in AB's ETF suite
NASHVILLE, Tenn., Dec. 13,
2023 /PRNewswire/ -- AllianceBernstein Holding L.P.
(NYSE: AB) and AllianceBernstein L.P., a leading global investment
management and research firm, announced today the launch of five
active exchange-traded funds (ETFs) on the NASDAQ and New York
Stock Exchange (NYSE) Arca: AB Conservative Buffer ETF [NASDAQ:
BUFC], AB Tax-Aware Intermediate Municipal ETF [NYSE:
TAFM], AB Tax-Aware Long Municipal ETF [NYSE: TAFL],
AB Corporate Bond ETF [NASDAQ: EYEG], and AB Core Plus
Bond ETF [NASDAQ: CPLS].
"On the heels of crossing the $1
billion threshold in active ETF AUM, these new ETFs will
provide clients with a broadened suite of versatile products, built
to help investors navigate the evolving market cycles we see coming
in 2024 and beyond," said AB's Global Head of ETFs and Portfolio
Solutions Noel Archard.
Details on the funds are as follows:
- [NASDAQ: BUFC]: The investment objective is to seek a
conservative level of capital appreciation while providing the
potential for some downside protection against market declines.
BUFC invests in a combination of exchange-traded options contracts
on an underlying ETF (an ETF that seeks to track the investment
results of the S&P 500 Index*). The fund's options strategy
seeks to provide investors with returns based on the price return
of the S&P 500, up to a cap, while providing a buffer against
losses, up to a cap, of the S&P 500 over rolling 3-month
periods. BUFC distinguishes itself from other buffered products
with option resets done on a rolling basis, a proprietary ratchet
feature and dynamic first loss provision.
"BUFC will allow our clients to access an evergreen options
strategy delivered with all the efficiencies that come from the ETF
wrapper," said AB's Head of Investment Solutions and Sciences
Andrew Chin. "We are excited to offer a new investment option that
aims to provide consistent returns with what we believe is a high
level of protection."
- [NYSE: TAFM and TAFL]: The investment objective of each
of TAFM and TAFL is to provide relative stability of principal and
a moderate rate of after-tax return and income. Each of TAFM and
TAFL pursues its objective by investing principally in a national
portfolio of both municipal and taxable fixed-income securities.
Each of TAFM and TAFL invests at least 80% of its net assets in
municipal securities. TAFM seeks to maintain an effective
duration of four to seven years while TAFL seeks to maintain an
effective duration of seven to fourteen years, under normal market
conditions.
- [NASDAQ: EYEG and CPLS]: The investment objective of
each of EYEG and CPLS is to maximize total return through current
income and long-term capital appreciation. EYEG pursues its
objective by investing at least 80% of its net assets in investment
grade fixed-income securities of corporate issuers. EYEG invests
primarily in U.S. dollar-denominated corporate debt securities
issued by U.S. and foreign companies (including developed and
emerging market debt securities). CPLS pursues its objective by
investing at least 80% of its net assets in fixed-income
securities. CPLS may invest in a broad range of debt securities,
including corporate bonds and debt and mortgage- and other
asset-backed securities issued by U.S. Government-sponsored
entities and federal agencies and instrumentalities that are not
backed by the full faith and credit of the U.S. Government. CPLS
may invest without limit in U.S. Dollar-denominated foreign
fixed-income securities (including developed and emerging market
debt securities). With respect to each of EYEG and CPLS, AB
employs a systematic investment process using a dynamic multifactor
approach. This approach, which is implemented by AB through its
proprietary research, investment and trading models and algorithms,
considers a number of factors in seeking to generate alpha through
a bottom‑up security selection process.
"Our Fixed Income and ETF Teams continually seek to deliver AB's
unique, tech-driven investment process in an active platform to
both our clients and the broader ETF community," said AB's Co-Head
of Fixed Income Scott DiMaggio. "Today's launch shows AB's
commitment to continued innovation and collaboration across asset
classes as we keep our clients' best interest at the forefront of
our efforts."
Global quantitative firm Susquehanna International Group will be
the lead market maker on the buffered product, and trading firm
Jane Street will be the lead market maker on the four Fixed
Income products – both bringing extensive industry experience and
pricing expertise to AB's ETFs.
For more information and to learn more about AB's ETF platform,
visit www.alliancebernstein.com/go/etfs.
About AllianceBernstein
AllianceBernstein is a leading global investment management firm
that offers high-quality research and diversified investment
services to institutional investors, individuals, and private
wealth clients in major world markets. As of November 30,
2023, AllianceBernstein had $696 billion in assets under
management. Additional information about AB may be found on our
website, www.alliancebernstein.com.
Disclosures
Investing in securities involves risk, and there is no
guarantee of principal.
Investors should consider the investment objectives, risks,
charges and expenses of the Fund/Portfolio carefully before
investing. For copies of our prospectus or summary prospectus,
which contain this and other information, visit us online at
www.alliancebernstein.com or contact your AB representative. Please
read the prospectus and/or summary prospectus carefully before
investing.
|
|
|
|
|
|
Investment
Risk
|
BUFC
|
TAFM
|
TAFL
|
EYEG
|
CPLS
|
Buffered Loss
Risk
|
X
|
|
|
|
|
Buffer/Cap Change
Risk
|
X
|
|
|
|
|
Capped Upside
Risk
|
X
|
|
|
|
|
FLEX Options
Correlation Risk
|
X
|
|
|
|
|
FLEX Options
Liquidity Risk
|
X
|
|
|
|
|
FLEX Options
Valuation Risk
|
X
|
|
|
|
|
Hedge Period
Risk
|
X
|
|
|
|
|
Active Trading
Risk
|
X
|
|
|
|
|
Non-Diversification
Risk
|
X
|
|
|
|
|
Underlying ETF
Risk
|
X
|
|
|
|
|
Cash
Transactions
|
X
|
X
|
X
|
X
|
X
|
Derivatives
Risk
|
X
|
X
|
X
|
X
|
X
|
Leverage
Risk
|
X
|
X
|
X
|
X
|
X
|
New Fund
Risk
|
X
|
X
|
X
|
X
|
X
|
Below Investment
Grade Securities Risk
|
|
X
|
X
|
X
|
X
|
Credit
Risk
|
|
X
|
X
|
X
|
X
|
Duration
Risk
|
|
X
|
X
|
X
|
X
|
Illiquid Investments
Risk
|
X
|
X
|
X
|
X
|
X
|
Inflation
Risk
|
|
X
|
X
|
X
|
X
|
Interest Rate
Risk
|
|
X
|
X
|
X
|
X
|
Market
Risk
|
X
|
X
|
X
|
X
|
X
|
Municipal Market
Risk
|
|
X
|
X
|
|
|
Tax
Risk
|
|
X
|
X
|
|
X
|
Variable and
Floating Rate Securities Risk
|
|
X
|
X
|
|
X
|
When-Issued and
Forward Commitment Risk
|
|
X
|
X
|
|
|
Foreign (Non-U.S.)
Investment Risk
|
|
|
|
X
|
X
|
Currency
Risk
|
|
|
|
|
X
|
Emerging Market
Risk
|
|
|
|
|
X
|
Mortgage-Related and
Other Asset-Backed Securities Risk
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares of the ETF may be bought or sold throughout the day at
their market price on the exchange on which they are listed. The
market price of an ETF's shares may be at, above or below the ETF's
net asset value (NAV), and will fluctuate with changes in the NAV
as well as with supply and demand in the market for the shares.
Shares of the ETF may only be redeemed directly with the ETF at NAV
by authorized participants, in very large creation units. There can
be no guarantee that an active trading market for the Fund's shares
will develop or be maintained, or that their listing will continue
or remain unchanged. Buying or selling the Fund's shares on an
exchange may require the payment of brokerage commissions, and
frequent trading may incur brokerage costs that detract
significantly from investment returns.
Buffered Loss Risk: There can be no guarantee that the
Fund will be successful in its strategy to buffer against
underlying ETF price declines. Despite the intended hedge period
buffer, a shareholder may lose money by investing in the Fund.
If, during a hedge period, an investor purchases shares of the Fund
after the date on which the Fund has entered into FLEX Options or
sells shares of the Fund prior to the expiration of the FLEX
Options, the hedge period buffer that the Fund seeks to provide may
not be available and the investor may not receive the full, or any,
benefit of the hedge period buffer. The Fund does not provide
principal protection, and an investor may experience significant
losses on an investment in the Fund. Buffer/Cap Change
Risk: A new hedge period buffer and a new hedge period
cap are established each time the Options Portfolio is implemented,
including after an upside-ratchet event. The duration of a hedge
period cap or hedge period buffer may vary. Capped Upside
Risk: If an investor purchases shares of the Fund after the
first day of a hedge period and the value of the underlying ETF
shares is at or near the hedge period cap for that hedge period,
there may be little or no ability for that investor to experience
an investment gain on their Fund shares unless the Fund engages in
an upside ratchet of the Fund's Options Portfolio. If an investor
does not hold their shares of the Fund for an entire hedge period,
the returns realized by that investor may not replicate those the
Fund seeks to achieve. If the underlying ETF experiences gains
during a hedge period in excess of the hedge period cap, unless the
Fund has engaged in an upside ratchet the Fund will not participate
in those gains beyond the hedge period cap. FLEX Options
Correlation Risk: Although the value of the FLEX Options
structure held by the Fund generally correlates with the share
price of the underlying ETF, the FLEX Options are exercisable at
the strike price only on their expiration date, and their daily
valuation will not change at the same percentage as the share price
of the underlying ETF. Accordingly, the Fund's NAV or market price
will not directly correlate on a day-to-day basis with the share
price of the underlying ETF. FLEX Options Liquidity
Risk: The FLEX Options are listed on an exchange; however,
there is no guarantee that a liquid secondary trading market will
exist for the FLEX Options. A less liquid trading market may
adversely impact the value of the FLEX Options and the value of
your investment. FLEX Options Valuation Risk: FLEX
Options held by the Fund will be exercisable at the strike price
only on their expiration date. The value of the FLEX Options will
be determined based upon market quotations or using other
recognized pricing methods. The value of a FLEX Option prior to its
expiration date may vary because of related factors other than the
value of the underlying ETF. During periods of reduced market
liquidity, or in the absence of readily available market quotations
for the holdings of the Fund, FLEX Options may become more
difficult to value, and the judgment of the Adviser, as the Fund's
valuation designee, may play a greater role in the valuation of the
Fund's holdings due to reduced availability of reliable objective
pricing data. Hedge Period Risk: The Fund's investment
strategy is designed to deliver returns that reference an
underlying ETF and are based on options contracts that are designed
to be in place for 90-day periods, although in some cases the Fund
will hold options contracts of longer duration. The Fund may not
hold its Options Portfolio for the full duration of the options
contracts, and the Adviser may change the Options Portfolio at any
time, which would begin a new hedge period. There is no guarantee
that any upside ratchet will be successfully implemented or that it
will deliver the desired investment result. Active Trading
Risk: The Fund expects to engage in active and frequent
trading, which will increase the portfolio turnover rate.
A higher portfolio turnover increases transaction costs and
may negatively affect the Fund's return. Non-Diversification
Risk: The Fund may have more risk because it is
"non-diversified," meaning that it can invest more of its assets in
a smaller number of issuers. Accordingly, changes in the value of a
single security may have a more significant effect, either negative
or positive, on the Fund's NAV. Underlying ETF
Risk: The Fund invests in FLEX Options that reference an
ETF, which subjects the Fund to certain of the risks of owning
shares of an ETF as well as the types of instruments in which the
underlying ETF invests. Cash Transactions Risk: The
Fund intends to effectuate all or a portion of the issuance and
redemption of creation units for cash, rather than in-kind
securities. As a result, an investment in the Fund may be less
tax-efficient than an investment in an ETF that effectuates its
creation units only on an in-kind basis. Derivatives Risk:
Derivatives may be difficult to price or unwind and leveraged so
that small changes produce disproportionate losses for the Fund.
Leverage Risk: To the extent the Fund uses leveraging
techniques, its NAV may be more volatile because leverage tends to
exaggerate the effect of changes in interest rates, and any
increase or decrease in the value of the Fund's investments. New
Fund Risk: The Fund is recently organized, which gives
prospective investors a limited track record on which to base their
investment decision. Below Investment Grade Securities
Risk: Investments in fixed-income securities with lower
ratings (a/k/a junk bonds) are subject to a higher probability that
an issuer will default or fail to meet its payment obligations.
These securities may be subject to greater price volatility due to
such factors as specific municipal or corporate developments and
negative performance of the junk bond market generally and may be
more difficult to trade than other types of securities. Credit
Risk: An issuer or guarantor of a fixed-income security, or the
counterparty to a derivatives or other contract, may be unable or
unwilling to make timely payments of interest or principal, or to
otherwise honor its obligations. Duration
Risk: Duration is a measure that relates the expected
price volatility of a fixed-income security to changes in interest
rates. The duration of a fixed-income security may be shorter than
or equal to full maturity of a fixed-income security. Fixed-income
securities with longer durations have more risk and will decrease
in price as interest rates rise. Illiquid Investment Risk:
Illiquid investments risk exists when certain investments are or
become difficult to purchase or sell. Difficulty in selling such
investments may result in sales at disadvantageous prices affecting
the value of your investment in the Fund. Inflation
Risk: This is the risk that the value of assets or income
from investments will be less in the future as inflation decreases
the value of money. As inflation increases, the value of the
Fund's assets can decline as can the value of the Fund's
distributions. Interest Rate
Risk: Changes in interest rates will affect the value of
investments in fixed-income securities. When interest rates
risk, the value of existing investments in fixed-income securities
tends to fall and this decrease in value may not be offset by
higher income from new investments. Market Risk: The value
of the Fund's assets will fluctuate as the market fluctuates.
Municipal Market Risk: This is the risk that special factors
may adversely affect the value of municipal securities and have a
significant effect on the yield or value of the Fund's investments
in municipal securities. Tax Risk: From time to time,
the U.S. Government and the U.S. Congress consider changes in
federal tax law that could limit or eliminate the federal tax
exemption for municipal bond income, which would in effect reduce
the federal tax exemption for municipal bond income, which would in
effect reduce the income received by shareholders from the Fund by
increasing taxes on that income. Variable and Floating-Rate
Securities Risk: Variable and floating-rate securities pay
interest at rates that are adjusted periodically, according to a
specific formula. Because the interest rate is reset only
periodically, changes in the interest rate on these securities may
lag behind changes in the prevailing market interest rates. The
value of the security may rise or fall depending on changes in
interest rates between periodic resets. When-Issued and Forward
Commitment Risks: These securities are purchased before the
securities are actually issued or delivered. These securities are
subject to the risk that, when delivered, they will be worth less
than the agreed-upon purchase price. Foreign (Non-U.S.)
Investment Risk: Investments in securities of non-U.S.
issuers may involve more risk than those of U.S. issuers. These
securities may fluctuate more widely in price and may be more
difficult to trade than domestic securities due to adverse market,
economic, political, regulatory, or other factors. Currency
Risk: Fluctuations in currency exchange rates may
negatively affect the value of the Fund's investments or reduce its
returns. Emerging Market Risk: Investments in
emerging market countries may have more risk because the markets
are less developed and less liquid as well as being subject to
increased economic, political, regulatory, or other
uncertainties. Mortgage-Related and Other Asset-Backed
Securities Risk: Investments in mortgage-related and other
asset-backed securities are subject to certain additional risks,
including extension risk and prepayment risk. The value of these
securities may be particularly sensitive to changes in interest
rates. Some mortgage-backed securities are to be announced (TBA)
securities, which have additional risks.
AllianceBernstein L.P. (AB) is the investment advisor for the
Funds.
Distributed by Foreside Fund Services, LLC. Foreside is not related
to AB.
*S&P 500 Index: The S&P 500® is widely regarded as
the best single gauge of large-cap U.S. equities. The index
includes 500 leading companies and covers approximately 80% of
available market capitalization.
View original
content:https://www.prnewswire.com/news-releases/alliancebernstein-launches-five-new-active-etfs-302013650.html
SOURCE AllianceBernstein