FTKI
First Trust Small Cap BuyWrite Income ETF
📎 Investment Objective
The First Trust Small Cap BuyWrite Income ETF seeks to provide current income and capital appreciation by investing in a portfolio of small-cap U.S. stocks and writing (selling) call options on those stocks.
Overview
ETF tracking First Trust Small Cap BuyWrite Income ETF
Performance
Price Chart
Investment Summary
📎 Investment Objective
The First Trust Small Cap BuyWrite Income ETF seeks to provide current income and capital appreciation by investing in a portfolio of small-cap U.S. stocks and writing (selling) call options on those stocks.
🎯 Investment Strategy
The fund invests in a portfolio of small-cap U.S. stocks and writes (sells) call options on those stocks. The goal is to generate income from the option premiums while also participating in the potential upside of the underlying stocks.
✨ Key Features
- Focuses on small-cap U.S. stocks
- Generates income through a covered call strategy
- Aims to provide both current income and capital appreciation
- Actively managed by First Trust's investment team
⚠️ Primary Risks
- Small-cap stocks may be more volatile and less liquid than larger companies
- Option writing can limit the upside potential if the underlying stocks rise significantly
- The fund's performance may be lower than the broader small-cap market if the covered call strategy underperforms
- Actively managed funds may underperform their benchmark indexes
👤 Best For
This ETF may be suitable for investors seeking current income and moderate capital appreciation, with a higher risk tolerance due to the small-cap focus and options strategy. It may be appropriate as a component of a diversified portfolio, but investors should be comfortable with the increased volatility and potential limitations on upside potential inherent in a covered call approach.