BUFC vs PAUG

BUFCBAB Conservative Buffer ETF

PAUGCInnovator U.S. Equity Power Buffer ETF - August

In short

BUFC Most buffer funds lock you into a 12-month outcome period. BUFC resets every three months, targeting 15% downside protection against the S&P 500 with roughly 3% of the upside per period. Deep cushion, short leash.

PAUG A shock absorber with a calendar. PAUG soaks up the first 15% of losses on an S&P 500 ETF over each roughly one-year stretch, trades away some upside via a cap, then resets every August 1.

Stated mandate

BUFC The Fund is an actively managed equity ETF seeking conservative capital appreciation with potential partial downside protection. It uses options to establish an upside cap and downside protection over rolling three-month periods, targeting 15% downside protection and about 3% upside participation to the S&P 500.

PAUG PAUG seeks to track SPY up to a predetermined upside cap while protecting the first 15% of losses over an approximately annual outcome period, resetting at the end of each period.

Why people hold it

• BUFC Uses options to target 15% downside protection against the S&P 500 over rolling three-month periods, so the cushion resets four times a year instead of once.alliancebernstein.com
• At 0.69%, it costs less than Innovator's 0.79% Power Buffer funds (PJUL, PJAN, POCT) and less than the typical fund in its buffer cohort.
• Actively managed rather than pinned to a calendar index series, running since 2023, and among the stronger implementations in its buffer peer group.

• PAUG The first 15 percentage points of reference-fund losses over the outcome period are absorbed before you feel anything. That buffer is written into the fund's documents, not left to a manager's judgment.innovatoretfs.com
• What's being shaped is plain vanilla US large cap: the reference asset is SPY, the S&P 500 tracker, not a bespoke smart-beta index built for the brochure.
• Live since August 2019, so the annual reset has run through several very different markets. It also has eleven monthly siblings, so the choice is a start date, not a strategy.
• Among the stronger implementations in a crowded buffer field, where a lot of look-alike funds charge similar money for similar mechanics.

Worth knowing

• BUFC The price of that deep cushion: upside participation is targeted near 3% per three-month period, so big rallies mostly pass you by.
• Protection is partial and period-based. Losses past the targeted 15% pass through, and buying mid-period shifts your effective buffer and cap.alliancebernstein.com
• Thinly traded for its size, so spreads and limit orders deserve attention.

• PAUG Upside is capped, and the cap is set fresh each period. Buy mid-period and you inherit whatever cap and buffer remain, which can look nothing like the headline terms.
• 0.79% a year is the price of the options engineering. It sits right at the median for buffer funds and well above plain index exposure.
• One of the quieter tickers in a busy category, so limit orders and a look at the spread matter more here than with a mega-fund.

Full BUFC profile⁠

Full PAUG profile⁠