KSPY vs PEPS

KSPYCKraneShares Hedgeye Hedged Equity Index ETF

PEPSBParametric Equity Plus ETF

In short

KSPY Most hedged equity funds pick one options overlay and live with it. KSPY follows a Hedgeye index that can swap between three different options strategies as often as daily, based on where the S&P 500 sits inside Hedgeye's Risk Range bands.

PEPS Active management at index-fund pricing. PEPS holds a U.S. large-cap base, then writes S&P 500 calls against offsetting long exposure: a beta-neutral overlay built to add return rather than swap upside for income.

Stated mandate

KSPY The fund tracks the Hedgeye Hedged Equity Index to provide S&P 500 exposure while actively seeking to reduce volatility and manage downside risk.

PEPS The Fund seeks long-term capital appreciation. It is actively managed, using a U.S. large-cap equity base and beta-neutral call overwriting on the S&P 500 with offsetting long exposure to seek incremental total return.

Why people hold it

• KSPY The index rotates among three options strategies depending on where the S&P 500 trades inside Hedgeye's Risk Range bands, and it can switch as often as daily.kraneshares.com
• It buys puts as well as selling calls, so the downside hedge is an actual options position rather than just collected premium.kraneshares.com
• No 12-month outcome period here: unlike buffer ETFs, there is no fixed cap to sit under for a year and no reset date to time your entry around.kraneshares.com
• Hedgeye has published its Risk Range signals since 2015. This packages that research as a rules-based index inside an ETF instead of a subscription you trade yourself.kraneshares.com

• PEPS 0.10% is index-fund pricing for an actively managed strategy. Even the cheap, well-regarded active peers cost more: DFAU at 0.12%, FELC at 0.18%.
• Not a covered-call fund. The sold S&P 500 calls are paired with offsetting long exposure, so the overlay seeks incremental total return instead of capping upside.
• Ordinary 1940 Act ETF wrapper, U.S. large-cap equity, distributions paid quarterly. The complexity lives in the overlay, not the tax paperwork.
• Cost is the standout: the typical active U.S. equity ETF in this group charges several times what PEPS does, and fee drag is the one input you know in advance.

Worth knowing

• KSPY At 0.88% a year, it prices above the typical S&P 500 options-strategy fund: the cost of an outside research firm's signals plus an active options overlay.
• Sold calls mean giving up some upside, and hedges cost money in calm, steadily rising markets. This is a volatility-smoothing tool, not an S&P 500 clone.kraneshares.com
• Launched in 2024 and among the smaller, thinly traded funds in its group, so spreads can run wider than at the mega-scale S&P options ETFs.

• PEPS Launched in November 2024. The overlay has not yet run through a full market cycle, so there is limited history to judge it on.
• A small, thinly traded fund. Bid-ask spreads can run wider than a mega-cap index ETF's, which shows up most on larger orders.
• The options leg adds moving parts: short index calls lose value in a sharp rally, and the offsetting long exposure is what has to make that back.

Full KSPY profile⁠

Full PEPS profile⁠