One of the newer entrants to the U.S. exchange-traded fund, or ETF, industry is Corgi Funds, the asset management arm of insurance technology company Corgi. The company has pursued an unusual expansion beyond insurance, including operating a café and free bus routes around San Francisco’s Y Combinator community, while recently raising capital at a $4 billion valuation.
Corgi’s ETF presence has expanded just as quickly, with 197 U.S.-listed ETFs as of August. The Financial Times has characterized the firm’s rapid-fire product strategy as an “ETF spaghetti cannon,” reflecting an approach of launching numerous funds and seeing which end up sticking. Of those 197 ETFs, 125 provide two-times leveraged exposure, while its second-largest category takes the opposite approach to risk, with 36 buffered ETFs designed to limit downside.
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Despite Corgi’s rapid expansion, it remains a relatively small player in the buffered ETF market. The category’s heavyweight is Innovator ETFs, which was acquired in April by Goldman Sachs Group Inc. (ticker: GS). At the time of the acquisition, Innovator managed $31 billion across 171 ETFs, with buffered strategies representing a substantial portion of its lineup.
Demand for buffered ETFs gained momentum following the 2022 bear market. Traditional 60/40 portfolios suffered unusually large losses as high inflation and rapidly rising interest rates pressured stock-bond correlations. For investors seeking more predictable protection, buffered ETFs offered an alternative.
These alternative strategies generally use combinations of options to reference the price return of a stock market benchmark, while protecting against a predetermined percentage of losses over a specified outcome period. In exchange, investors typically accept an upside cap and generally forgo the dividend income they would have received from owning the underlying stocks directly.
There is no free lunch, however. AQR Capital Management co-founder Cliff Asness has argued that investors can achieve buffered ETF outcomes more simply by combining stocks with cash. Buffered ETFs also tend to charge considerably more than index funds, have payoff profiles that can be difficult to understand and their upside caps mean investors can underperform during bull markets.
Still, downside protection can have behavioral value. Much like training wheels for a new cyclist or gutter guards for a beginning bowler, limiting losses may help risk-averse investors remain invested through periods of market stress rather than panic-selling at an inopportune time.
“Across our structured protection lineup, we’re seeing three consistent use cases: managing equity risk, putting cash to work and building more resilient retirement portfolios,” explains Matt Kaufman, senior vice president and global head of ETFs at Calamos Investments. “The common thread is flexibility, as advisors can decide exactly how much equity exposure they want to keep and how much downside they’re willing to give up over the outcome period.”
Here are five notable buffered ETFs offering downside protection:
| ETF | Expense Ratio |
| Innovator Laddered Allocation Buffer ETF (BUFB) | 0.89% |
| First Trust Vest Laddered Buffered ETF (BUFR) | 0.95% |
| iShares Large Cap Deep Quarterly Laddered ETF (IVVB) | 0.50% |
| Calamos Laddered S&P 500 Structured Alt Protection ETF (CPSL) | 0.79% |
| KraneShares 90% KWEB Defined Outcome January 2027 ETF (KBUF) | 0.97% |
Innovator Laddered Allocation Buffer ETF (BUFB)
Buying a buffered ETF is different from allocating to a conventional equity ETF because many are designed around a specific outcome period, typically one year. This is why individual buffered ETFs often have months in their names.
Their stated upside caps and downside buffers generally apply only when shares are held from the beginning through the end of that outcome period. Buying midway through means some of the remaining upside cap or downside buffer may already have been used. The need to select the appropriate “vintage” is why providers such as Innovator offer laddered solutions like BUFB.
Using a fund-of-funds structure, BUFB equally weights 12 monthly Innovator U.S. equity buffer ETFs, spreading investors across different outcome periods rather than requiring them to time a single fund. Each underlying ETF references the price return of the S&P 500 while seeking to protect against the first 9% of losses, with its own individually determined upside cap.
BUFB’s protection reflects the combined results of 12 overlapping outcome periods rather than one clean buffer and cap applying to the entire investment. That makes the strategy more evergreen and reduces the importance of entry timing, but its realized protection can be less intuitive than owning an individual vintage from start to finish. Innovator’s website tracks each underlying ETF against the S&P 500, allowing investors to see how much upside potential and downside buffer remain.
That convenience also comes at a relatively high cost. BUFB has a 0.89% total expense ratio, consisting of a 0.1% management fee plus 0.79% in acquired fund fees and expenses from its underlying buffer ETFs. Beyond BUFB, Innovator offers buffer ETFs with a wide range of risk-return profiles. These include strategies designed to protect against as much as 100% of losses over their stated outcome periods, as well as shorter-term ETFs that reset their caps and buffers quarterly.
First Trust Vest Laddered Buffered ETF (BUFR)
BUFR is a direct competitor to BUFB, using a fund-of-funds structure that holds 12 First Trust Vest U.S. equity buffer ETFs with different monthly outcome periods. Each underlying ETF seeks to match the price return of the S&P 500 up to a predetermined cap while protecting against the first 10% of losses before fees over its stated outcome period.
Importantly, the 10% buffer applies to each underlying ETF rather than BUFR itself. By combining 12 vintages at different points in their outcome periods, BUFR aggregates their individual payoff profiles into a potentially smoother experience without requiring investors to select a particular monthly vintage.
First Trust provides an online chart showing where each of the 12 underlying ETFs stands within its outcome period. Investors can view the days left in the outcome period, original versus remaining upside caps and downside buffers, and how much downside exposure exists before the buffer begins, if any. This is useful because those parameters change as the S&P 500 moves throughout each outcome period.
Investors who do not want BUFR’s laddered approach can still select individual monthly First Trust Vest ETFs based on their preferred outcome period, buffer and upside cap. The firm’s buffered ETF lineup also extends beyond the S&P 500, with buffered exposure available for developed and emerging market equities, small-cap stocks and U.S. large-cap growth stocks.
The usual buffer ETF trade-offs still apply with BUFR. It references the S&P 500’s price return, meaning investors forgo dividends that would otherwise contribute positively to total return. BUFR is also relatively pricey, with a 0.1% management fee plus 0.85% in acquired fund fees and expenses, for a 0.95% total expense ratio.
iShares Large Cap Deep Quarterly Laddered ETF (IVVB)
IVVB combines staggered quarterly buffers designed to protect against losses between 5% and 20% in the S&P 500’s price. Investors remain exposed to the first 5% of losses, receive protection through the next 15% of a decline and resume downside participation beyond 20%. Unlike the preceding ETFs, IVVB therefore requires investors to absorb small drawdowns before protection begins.
Because these quarterly strategies are laddered together, however, investors should not interpret IVVB as providing one precise 5%-to-20% buffer across the entire portfolio at any given moment. The different option positions are simultaneously progressing through separate outcome periods, making IVVB more of an evergreen solution than point-to-point protection.
Another difference is income. Most of IVVB’s portfolio is invested directly in the iShares Core S&P 500 ETF (IVV), allowing shareholders to retain some dividend participation. IVVB consequently offers a modest 0.7% 30-day SEC yield, an advantage over buffer strategies that reference only the S&P 500’s price return. IVVB is also cheaper than the preceding laddered buffer ETFs, with a 0.5% expense ratio.
Calamos Laddered S&P 500 Structured Alt Protection ETF (CPSL)
Each of the preceding buffered ETFs eventually reintroduces downside participation once its applicable protection has been exhausted. Their role is therefore more about dampening routine market volatility and moderate corrections than protecting against a catastrophic drawdown. For investors seeking more substantial crash protection, CPSL takes the buffered ETF concept considerably further.
CPSL uses a fund-of-funds structure holding 12 monthly Calamos S&P 500 structured protection ETFs. Each of these is designed to provide 100% point-to-point protection against declines in the S&P 500 over its stated outcome period, before fees and expenses. Because the targeted downside protection is 100%, their upside caps tend to be considerably more restrictive than those of conventional buffer ETFs.
“CPSL allows investors to reduce downside risk by an amount they’re comfortable with, without needing to move the entire equity sleeve into a risk-managed strategy,” Kaufman explains. “For example, a 40% allocation to CPSL and 60% S&P 500 allocation has behaved a lot like a straight 10% buffer but built more efficiently, because you can leave 60% of the equity sleeve alone.”
Historically, that structure has substantially reduced drawdown depth. During the 2025 tariff-driven sell-off from February through May, the S&P 500 experienced an 18.8% maximum drawdown, compared with just 3.7% for CPSL. The trade-off was that CPSL had considerably less upside participation when stocks subsequently recovered.
“CPSL is also a useful building block for retirement portfolios, where the goal is protecting against the sequence-of-return risk of a market downturn early in retirement when withdrawals can do lasting damage,” Kaufman says. “And because it’s one ticker rather than a monthly series, advisors can use it consistently across models without managing a rolling ladder themselves.”
CPSL charges a relatively high 0.79% total expense ratio, consisting of a 0.1% management fee and 0.69% in acquired fund fees and expenses from its underlying ETFs. As with many options-based buffer ETFs, investors also forgo participation in dividends. Calamos offers similar laddered structured-protection strategies referencing other benchmarks, including the Nasdaq-100, Russell 2000 and Bitcoin.
KraneShares 90% KWEB Defined Outcome January 2027 ETF (KBUF)
Most buffer ETFs reference U.S. benchmarks such as the S&P 500, Nasdaq-100 or Russell 2000. Some providers, however, have extended the concept to specialized sector- and country-specific exposures. KBUF combines both, with its outcome tied to the KraneShares CSI China Internet ETF (KWEB).
KWEB has historically been more volatile than broad U.S. equity benchmarks. Chinese technology stocks face unique risks involving government regulation, U.S.-China relations, trade restrictions, variable interest entity structures and changes in consumer spending. That volatility remained evident in 2026, with KWEB down 17.7% on a total-return basis through the end of July.
KraneShares launched KBUF as a way to retain exposure to KWEB while substantially limiting downside risk. Over its two-year outcome period running from Jan. 27, 2025, through Jan. 15, 2027, KBUF seeks to provide a maximum 40.01% upside return, while buffering against 90% of KWEB’s losses from -10% to -100%. The ETF charges a 0.97% expense ratio.
“Due to market volatility in China’s internet sector, KBUF’s current upside cap and downside buffer ratio are more attractive now than when the outcome period started,” explains Henry Greene, senior investment strategist at KraneShares. “With just 161 days remaining out of the initial 718-day window as of Aug. 7, 2026, there is currently a 43.8% upside cap and a 92.43% downside buffer.”
Investors looking for even greater protection can instead consider the KraneShares 100% KWEB Defined Outcome January 2027 ETF (KPRO). It covers the same outcome period as KBUF, but seeks to buffer 100% of KWEB’s losses from the outset, before fees. The trade-off is a much lower upside cap of 20.01%, half KBUF’s maximum, along with a slightly higher 1% expense ratio.
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Update 08/10/26: This story was previously published at an earlier date and has been updated with new information.
