New Cboe Vest Fund Targets Distributions of 3.5% Above the S&P 500 with Proportional Price Returns

MCLEAN, Va., Nov. 8, 2017 /PRNewswire/ -- The newest mutual fund from Cboe Vest Financial LLC ("Cboe Vest") seeks to track the recently launched Cboe S&P 500 Dividend Aristocrats Target Income Index (SPAI), an index designed to track the hypothetical performance of a partial buy-write strategy applied to stocks contained in the widely utilized S&P 500 Dividend Aristocrats Index.

The Cboe Vest S&P 500® Dividend Aristocrats Target Income Fund (KNGIX) is designed with the goal of generating an annualized level of distributions, before fees and expenses, of approximately 3.5% over the annual dividend yield of the S&P 500 Index (the current income target of the Fund as of November 3, 2017 is approximately 5.5% before fees and expenses) while generating price returns proportional to the price returns of the S&P 500 Index.

"Income investors have been challenged since the global financial crisis. Yields on fixed-income bonds are lower than most investment portfolio income targets and prices are likely to depreciate as rates rise," said Steve Neamtz, President of Cboe Vest.  "KNGIX was designed to address this income dilemma."

"By combining premium income from the sale of options with the dividend income of the stocks, investors may increase their total distributions while still participating in the majority of the growth potential from price appreciation," said Neamtz. "The key is starting with "Aristocrats" stocks and applying an innovative partial Weekly overwrite strategy developed by Cboe."

Index Highlights:

• The Index uses Cboe's "Target Income Partial Overwrite Strategy" that seeks to add a level of targeted income to dividend grower stocks by trading some of their uncertain future growth opportunity for current income.
• The methodology involves repeatedly writing Weekly call options on a small portion of the stock holdings.
• By combining premiums collected from the sale of the options with the dividend income of the stocks, investors may increase their total income while still participating in the majority of the growth potential from price appreciation of the stock.
• The strategy varies the number of call options written, based on market conditions, with the goal of generating total income, before fees and expenses, from dividends and options premiums of approximately 3.5% over the dividend yield of the S&P 500 Index, over an annualized period.

For more information or a fund prospectus, please visit the Cboe VEST S&P 500® Dividend Aristocrats Target Income Fund.

About Cboe Vest
Cboe Vest is a majority owned subsidiary of Cboe Global Markets, Inc. (NASDAQ: CBOE), the holding company of the Cboe Options Exchange, which is the largest US options exchange and creator of listed options. Cboe Vest is dedicated to serving investment advisors and brokerage firms in bringing wider access to innovative Target Outcome Investment strategies, including managed account offerings and a series of mutual funds designed to provide greater certainty over risk protection, enhanced returns and consistent income. Learn more at https://www.cboevest.com/.

Media Contact:
Jaime Doyle, JConnelly
(973) 850-7308 
[email protected]

Company Contact:
Linda Werner, Cboe Vest
202-794-6061
[email protected]

DISCLOSURES 
Investors should consider the investment objectives, potential risks, management fees and charges and expenses carefully before investing. This and other information is contained in the Fund's prospectus, which may be obtained by calling (855) 505-8378 or by visiting www.cboevestfunds.com. Please read the prospectus carefully before investing. Distributed by First Dominion Capital Corp., Richmond, VA. Member FINRA.

Call Options Risk. The Fund's use of derivatives, such as call options, can lead to losses because of adverse movements in the price or value of the underlying stock. FLEX Options Risk. The Fund expects to utilize FLEX Options issued and guaranteed for settlement by the Options Clearing Corporation (OCC). The Fund bears the risk that the OCC will be unable or unwilling to perform its obligations under the FLEX Options contracts. Additionally, FLEX Options may be less liquid than certain other securities, such as standardized options. New Fund Risk. The Fund is recently formed. Accordingly, investors in the Fund bear the risk that the Fund may not be successful in implementing its respective investment strategies. Portfolio Turnover Risk. The Fund's strategy will frequently involve buying and selling Call Options to generate premium income. High portfolio turnover may result in the Fund paying higher levels of transaction costs and generating greater tax liabilities for shareholders. Index Limitations Risk. The Index is designed to represent a proposed option writing strategy. The Index Calculation Agent uses an option valuation method to calculate the value of the portfolio of FLEX Options that are constituents of the Index. Failure by the Index Calculation Agent to fully comprehend and accurately model the constituent FLEX Options may cause the performance of the Index to vary from the performance of an actual portfolio of the constituent securities or the performance of the Fund. Newly Created Index Risk. The Index is newly created and has a limited history of performance. As such, it is uncertain how closely the Index may be able to track the performance of an actual portfolio of the constituent securities that comprise the Index. Tracking Error Risk. The Fund's return may not match or achieve a high degree of correlation with the return of the Index.  More information about these and other risks can be found in the Fund's prospectus.

SOURCE Cboe Vest

Related Links

https://www.cboevest.com