WisdomTree Prime® and WisdomTree Connect™ now offer access to an institutional option overlay strategy with new fund
NEW YORK--(BUSINESS WIRE)--WisdomTree, Inc. (NYSE: WT) (“WisdomTree”), a global financial innovator, today announced the launch of the WisdomTree Equity Premium Income Digital Fund (token ticker: EPXC; fund ticker: WTPIX), available to both retail and institutional investors via the WisdomTree Prime® and WisdomTree Connect™ platforms. The fund seeks to track the price and yield performance, before fees and expenses, of the Volos U.S. Large Cap Target 2.5% PutWrite Index.1
Put writing has been used by professional investors for decades as a solution seeking to increase the yield and lower the volatility of equity returns over various market cycles. WisdomTree has years of experience in this space, sponsoring a similar product that seeks to track the same benchmark.
The digital fund offers potential for enhanced risk-adjusted returns compared to the S&P 500 Index or a similar covered call strategy, all through a transparent, tokenized fund structure available to crypto-native investors and institutions. The WisdomTree Prime and WisdomTree Connect platforms offer access to real world asset (RWA) exposures in regulated structures without having to operate offchain. EPXC is the fifteenth tokenized fund available on the platforms, supporting users’ ability to invest in yield-bearing and diversifying assets.
“ETFs and other 1940-Act funds have demonstrated how options overlay strategies can be made available to a wider range of investors. We’re thrilled to bring an options overlay strategy to the onchain community,” said Will Peck, Head of Digital Assets at WisdomTree. “EPXC is an exciting addition to our suite of tokenized funds that leverages our expertise in building intuitive funds that are designed to perform in different market conditions. The fund’s ability to generate income, reduce downside risk and manage volatility gives users choice as they execute their strategies onchain via WisdomTree Prime and WisdomTree Connect.”
EPXC offers potential to generate income from premiums generated by selling put options2 and is designed to perform relatively well versus traditional equity strategies in flat-to-down markets. The fund aims to generate consistent income by selling put options bi-weekly on the ETF trust that tracks the S&P 500 Index3, targeting a 2.5% premium. By increasing its sensitivity to equity market movements, the Fund offers greater income potential, making it a compelling solution for investors navigating volatile market environments.
“Over various market cycles, equities have historically been the primary driver of total returns – but also a leading source of risk and volatility,” said Jeremy Schwartz, Global Chief Investment Officer at WisdomTree. “In this environment, EPXC offers a compelling approach for income-focused investors – substituting straight equity exposure for a strategy that captures the volatility premium in the options market to add value during turbulent times.”
Read more about the WisdomTree Equity Premium Income Digital Fund here. For more information about WisdomTree Prime and WisdomTree Connect, please visit: https://www.wisdomtreeprime.com/ and https://www.wisdomtreeconnect.com.
1Volos U.S. Large Cap Target 2.5% PutWrite Index: Tracks the value of a cash-secured (i.e., collateralized) put option sales strategy, which consists of selling (or “writing”) put options on the SPDR S&P 500 ETF Trust (SPY) and a cash collateral account that accrues interest at a theoretical three-month Treasury bill rate.
2Put options: An option to sell assets at an agreed price on or before a particular date.
3S&P 500 Index: Market capitalization-weighted benchmark of 500 stocks selected by the Standard and Poor’s Index Committee designed to represent the performance of the leading industries in the United States economy.
Carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. To obtain a prospectus containing this and other important information, please visit https://www.wisdomtree.com/investments/regulatory. Read the prospectus carefully before investing. There are risks associated with investing, including possible loss of principal.
The Fund will invest in derivatives, including put options on the SPDR S&P 500 ETF Trust (“SPY Puts”). Derivative investments can be volatile, and these investments may be less liquid than securities, and more sensitive to the effects of varied economic conditions. All SPY Puts are exchange-listed standardized options. The SPY Puts are selected to target a premium of 2.5%. THE SPY Puts sold by the Fund may have imperfect correlation to the returns of the Index. Although the Fund collects premiums on the SPY Puts it writes, the Fund’s risk of loss if the price of SPY falls below the strike price and the SPY Puts are exercised as of the Roll Date may outweigh the gains to the fund from the receipt of such option premiums. The sale of cash-secured SPY Puts serves to partially offset a decline in the price of SPY to the extent of the premiums received. The potential return to the Fund is limited to the amount of option premiums it receives; however, the Fund can potentially lose up to the entire strike price of each option it sells. By virtue of its put option sales strategy, Fund returns will be subject to an upside limitation on returns attributable to SPY, and the Fund will not participate in gains beyond such upside limitation. The Fund's investment strategy is subject to risks related to rolling. To the extent the Fund's portfolio managers are unable to roll the SPY Puts as described in the Fund's principal investment strategy, the Fund may be unable to achieve its investment objective. Due to the investment strategy of the Fund, it may make higher capital gain distributions than other mutual funds.
A blockchain is an open, distributed ledger that digitally records transactions in a verifiable way. A distributed ledger is a database in which data is stored in a decentralized manner. A blockchain stores transaction data in “blocks” that are linked together to form a “chain”, and hence the name blockchain. Tokenization is the recording of digital representations of Fund shares on an applicable blockchain.
Blockchain technology is a relatively new and untested technology, with little regulation. Blockchain systems could be vulnerable to fraud, particularly if a significant minority of participants colluded to defraud the rest. Potential risks also include vulnerability to theft, or inaccessibility, and future regulatory developments could affect its viability. Blockchain networks can also experience delays in transaction processing and settlement, particularly during periods of high network congestion or increased transaction volume. Flaws or errors in blockchain integrated recordkeeping could negatively impact the execution or recordkeeping of transactions in Digital Fund shares. Blockchain networks typically impose transaction fees in the form of the network’s native digital asset. These fees can be unpredictable and may vary significantly depending on network conditions and levels of congestion. Investors should note that they may experience materially different service levels on different blockchains.
Cybersecurity attacks affecting a Digital Fund’s third-party service providers, the application used to transact in Digital Fund shares, blockchain network, or the issuers of securities in which a Digital Fund invests may subject a Digital Fund to many of the same risks associated with direct cybersecurity breaches.
Please read the Fund’s prospectus for specific details regarding the Fund’s risk profile.
Statements concerning financial market trends are based on current market conditions, which will fluctuate.
The Fund is distributed by WisdomTree Securities, Inc.
About WisdomTree
WisdomTree is a global financial innovator, offering a diverse suite of exchange-traded products (ETPs), models and solutions, as well as digital asset-related products. Our offerings empower investors to shape their financial future and equip financial professionals to grow their businesses. Leveraging the latest financial infrastructure, we create products that emphasize access, transparency and provide an enhanced user experience. Building on our heritage of innovation, we offer next-generation digital products and services related to tokenized real world assets and stablecoins, as well as our institutional platform, WisdomTree Connect™, and blockchain-native digital wallet, WisdomTree Prime®.*
* The WisdomTree Connect institutional platform and WisdomTree Prime digital wallet and digital asset services are made available through WisdomTree Digital Movement, Inc., a federally registered money services business, state-licensed money transmitter and financial technology company (NMLS ID: 2372500) or WisdomTree Digital Trust Company, LLC, in select U.S. jurisdictions and may be limited where prohibited by law. WisdomTree Digital Trust Company, LLC is chartered as a limited purpose trust company by the New York State Department of Financial Services to engage in virtual currency business. Visit https://wisdomtreeconnect.com, https://www.wisdomtreeprime.com or the WisdomTree Prime mobile app for more information.
WisdomTree currently has approximately $137.4 billion in assets under management globally, inclusive of assets under management attributable to our recently completed acquisition of Ceres Partners, LLC.
For more information about WisdomTree, WisdomTree Connect and WisdomTree Prime, visit: https://www.wisdomtree.com.
Please visit us on X at @WisdomTreeNews.
WisdomTree® is the marketing name for WisdomTree, Inc. and its subsidiaries worldwide.
PRODUCTS AND SERVICES AVAILABLE VIA WISDOMTREE PRIME:
NOT FDIC INSURED | NO BANK GUARANTEE | NOT A BANK DEPOSIT | MAY LOSE VALUE | NOT SIPC PROTECTED | NOT INSURED BY ANY GOVERNMENT AGENCY
The products and services available through WisdomTree Connect and the WisdomTree Prime app are not endorsed, indemnified or guaranteed by any regulatory agency.
Category: Business Update
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Media Relations
WisdomTree, Inc.
Jessica Zaloom
+1.917.267.3735
jzaloom@wisdomtree.com