The first quarter isn’t yet in the books and many investors are feeling as though 2026 brought more volatility than they bargained for. Geopolitical events have a lot to do with that as does soft economic data. In an example of those factors being intertwined, the recent spike in oil prices due to the Iran conflict is diminishing the odds of the Federal Reserve cutting interest rates this year because higher oil prices are inflationary.
Not surprisingly, the global goings on in the first quarter are prompting some market participants to dial back risk, including embracing bonds and defensive equities. Exchange traded funds (ETFs) help advisors and investors accomplish those objectives and it’s possible if not likely that many are examining low volatility ETFs – the basic iterations of which reduce downside capture in when stocks falter.
The operative word there is “reduce.” Notice “eliminate” doesn’t appear there. Said differently, now is an appropriate time for asset allocators to evaluate unique ETFs that offer clients some downside protection. Enter the Calamos Laddered S&P 500® Structured Alt Protection ETF™ (CPSL).
CPSL, which debuted in September 2024, is a fund of funds in that its holdings are the ETFs in Calamos Structured Protection suite. Put simply, this is an institutional-level strategy that provides the tailoring and time efficiencies craved by advisors.
CPSL Is Simple and Effective
A nifty element in the structured protection ETFs is that these products offer full downside protection with a potential upside kicker. Additionally, the Calamos ETFs remove the need for advisors to tinker and change positions on a monthly basis. That straight forward approach extends to CPSL.
“The real beauty of CPSL lies in its simplicity. As a fund of funds, it equally allocates capital across 12 Calamos S&P 500® Structured Alt Protection ETFs®, with each fund initiating its outcome period in a different month,” according to the issuer. “This design creates continuous laddered exposure to downside protection and long-term equity upside potential.”
Admittedly, two and a half months isn’t an appropriate timeline on which to judge a fund like CPSL, but the bottom line is the ETF is doing its job this year. As of March 17, the Calamos fund is up 0.47% year-to-date while the S&P 500 is off 1.63%. This is old hat for CPSL and 2025 confirms as much.
The ETF’s design paved the way for it “to demonstrate its value during challenging market conditions. The fund provided notable downside protection during the late February (2025) to early April tariff-related selloff, which sent the S&P 500 tumbling -18.75%, while successfully capturing gains in the subsequent market recovery,” adds Calamos.
CPSL Has Lots of Utility
As noted above, part of CPSL’s allure is its simplicity, but equally as attractive is the ETF’s utility. Advisors considering the ETF can look at through lenses of equity hedging and/or a fixed income alternative – both of which are worth considering today.
“For the trillions of dollars in short-term debt instruments, structured protection strategies may offer similar or better downside management than bonds as well as meaningful, superior upside potential—especially on an after-tax basis where the tax ‘alpha’ can far outweigh bond yields over time,” observes Calamos.
The tax perk arrives by way of structured protection ETFs compounding deferred gains and when clients hold CPSL for over a year, their tax obligation is long-term capital gains.
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