Neuberger Berman Launches Collateralized PutWrite Fund
Alexander Samuelson, 212 476 5392, Alexander.Samuelson@NB.com
Mutual fund investment option for:
- Investors pursuing equity-like returns with less volatility than the broader equity markets1
- Investors seeking to complement or replace traditional alternatives
New York, September 20, 2016 — Neuberger Berman, one of the world’s leading employee-owned investment managers, today announced the launch of the Neuberger Berman U.S. Equity Index PutWrite Strategy Fund (tickers: NUPIX, NUPAX, NUPCX, NUPRX) (the “Fund”), which seeks to provide individual investors with exposure to equity market returns with less volatility. The Fund’s disciplined investment approach seeks to generate attractive risk-adjusted returns through harvesting premiums from selling puts on U.S. equity indexes combined with income potential from a conservatively managed collateral portfolio.
Doug Kramer, Co-Head of Quantitative & Multi-Asset Class Investments at Neuberger Berman said, “As equity markets push toward all-time highs, we are pleased to offer investors a defensively positioned lower volatility strategy that also seeks to maintain equity upside potential in mutual fund format.”
The Fund is managed by Neuberger Berman’s Options Group investment team which is part of the Quantitative and Multi-Asset Class team. Derek Devens, Managing Director, is the Fund’s Senior Portfolio manager and is supported by research analysts Rory Ewing and Eric Zhou.
Mr. Devens said, “We are excited to offer investors access to an index PutWrite strategy with a disciplined, all-cap investment approach. A growing number of individual and institutional investors are utilizing put writing strategies to seek to promote portfolio return consistency in disparate market environments, and to complement equity exposure.”
About Neuberger Berman
Neuberger Berman, founded in 1939, is a private, independent, employee-owned investment manager. The firm manages equities, fixed income, private equity and hedge fund portfolios for institutions and advisors worldwide. With offices in 19 countries, Neuberger Berman’s team is approximately 2,000 professionals and the company was named by Pensions & Investments as a Best Place to Work in Money Management for three consecutive years. Tenured, stable and long-term in focus, the firm fosters an investment culture of fundamental research and independent thinking. It manages $246 billion in client assets as of June 30, 2016. For more information, please visit our website at www.nb.com.
1 The portfolio composition, strategy, risks and fees and expenses, and accordingly the performance, of alternative products such as options strategies may differ significantly from other traditional asset class offerings, including equities and fixed income products. Put writing makes an explicit trade-off between up-market participation and down-market participation, while still seeking reasonable returns in flat markets.
An investor should consider Neuberger Berman U.S. Equity Index PutWrite Strategy Fund’s investment objectives, risks and fees and expenses carefully before investing. This and other important information can be found in the Fund’s prospectus, and if available summary prospectus, which you can obtain by calling 877.628.2583. Please read the prospectus, and if available the summary prospectus, carefully before making an investment.
Shares in the Fund may fluctuate based on market condition, interest rates credit quality and other factors. Most of the Fund’s performance depends on what happens in the equity and fixed income markets. Markets may be volatile and values of individual securities and other investments, including those of a particular type, may decline significantly in response to adverse issuer, political, regulatory, market, economic or other developments that may cause broad changes in market value, public perceptions concerning these developments, and adverse investor sentiment.
The Fund is a mutual fund, not a bank deposit, and is not guaranteed or insured by the Federal Deposit Insurance Corporation or any other government agency. The value of your investment may fall, sometimes sharply, and you could lose money by investing in the Fund. Since the Fund is recently launched, there is a risk the Fund may not be successful in implementing its investment strategy, and may not employ a successful investment strategy, either of which could result in the Fund being liquidated at any time without shareholder approval and/or at a time that may not be favorable for certain shareholders.
Derivatives involve risks different from, and in some respects greater than, those associated with more traditional investments, as derivatives can be highly complex and volatile, difficult to value, highly illiquid, and the Fund may not be able to close out or sell a derivative at a particular time or at an anticipated price. Derivatives can create leverage, and the Fund could lose more than the amount it invests. There can be no assurance that the Fund’s use of any leverage will be successful and the Fund’s investment exposure can exceed its total assets. Additionally, derivatives involve the risk that the counterparty or clearing organization will default in the performance of its obligations.
Options involve investment strategies and risks different from those associated with ordinary portfolio securities transactions. By writing put options, the Fund assumes the risk of declines in the value of the underlying instrument and the risk that it must purchase the underlying instrument at an exercise price that may be higher than the market price of the instrument, including the possibility of a loss up to the entire strike price of each option it sells but without the corresponding opportunity to benefit from potential increases in the value of the underlying instrument.. If there is a broad market decline and the Fund is not able to close out its written put options, it may result in substantial losses to the Fund. The Fund will receive a premium from writing options, but the premium received may not be sufficient to offset any losses sustained from exercised put options.
Although certain securities carry U.S. government guarantees, these guarantees do not extend to shares of the Fund itself or to the market prices of the securities; not all securities issued by the U.S. government and its agencies and instrumentalities are backed by the full faith and credit of the U.S. Treasury.
Investments in ETFs and other investment companies are subject to the risks of the investment companies’ investments, expenses and performance. ETFs, may trade in the secondary market at a price below the value of its underlying portfolio and may not be liquid.
Fund performance is dependent upon the success of the Portfolio Manager in implementing the Fund’s investment strategies in pursuit of its objective. The Fund’s performance will also depend on the success of implementing and managing the investment models that assist in allocating the Fund’s assets.
It should not be assumed that an investment in the fund will be profitable or will equal the performance of securities referenced herein. Neuberger Berman products and services may not be available in all jurisdictions or to all client types. Opinions expressed are as of the date herein and are subject to change without notice. This material is not intended to be a formal research report, is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. Information presented may include estimates, outlooks, projections and other “forward-looking statements.” Due to a variety of factors, actual events may differ significantly from those presented. Any views or opinions expressed may not reflect those of the firm as a whole.
All information is as of June 30, 2016 unless otherwise indicated and is subject to change without notice. Firm data, including employee and assets under management figures, reflects collective data for the various affiliated investment advisers that are subsidiaries of Neuberger Berman Group LLC. Firm history/timeline includes the history of all firm subsidiaries, including predecessor entities and acquisitions.
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