LOCT vs PSMJ

LOCTCInnovator Premium Income 15 Buffer ETF

PSMJBPacer Swan SOS Moderate (July) ETF

In short

LOCT Most buffer funds trade your upside for a capped shot at growth. LOCT trades it for income: a defined distribution rate paid monthly, with the first 15% of SPY's losses absorbed over each 12-month outcome period.

PSMJ Pacer's July-dated stop on the Swan SOS ladder: FLEX options on SPY that buffer the first 15% of a fall over a roughly one-year period, with upside capped in return. At 0.49%, it undercuts most of the buffer aisle.

Stated mandate

LOCT The Fund seeks performance equal to its Defined Distribution Rate for each Outcome Period while protecting against the first 15% of SPY losses during each 12-month Outcome Period.

PSMJ The Fund seeks to track the returns of the SPDR S&P 500 ETF Trust up to a predetermined cap while providing a downside buffer over an approximately one-year period.

Why people hold it

• LOCT Income-first design. The fund seeks performance equal to its stated Defined Distribution Rate for each outcome period, and it pays monthly rather than hoarding returns for the reset.
• The first 15% of SPY losses in each 12-month outcome period is absorbed by the structure, and the terms reset every October like clockwork.
• The 0.79% fee sits right at the median for its buffer peer group and matches Innovator's Power Buffer siblings (POCT, PJUL) for the same wrapper work.
• Built as a 1940 Act fund, not a bank-issued note, so the defined outcome doesn't ride on a single issuer's balance sheet.

• PSMJ Charges 0.49% a year against a 0.79% median for its buffered-SPY cohort, the same 0.79% Innovator's Power Buffer funds (PJUL, PJAN, POCT) charge for a similar job.
• The deal is legible: FLEX options on SPY absorb the first 15% of a decline over the outcome period, and match the ETF's gains up to a cap struck each July.paceretfs.compaceretfs.com 2
• Those FLEX options are customizable exchange-traded contracts settled through the Options Clearing Corporation, and Durango-based Swan Global Management sub-advises the strategy.paceretfs.com
• One of four Moderate-series funds with staggered start months (PSMD, PSMR, PSMJ, PSMO), so a July reset can be stacked against other entry points rather than standing alone.paceretfs.com

Worth knowing

• LOCT Upside is defined, not open-ended. The target is the distribution rate, so a roaring year in SPY doesn't flow through as extra return.
• Small asset base and thin trading. Limit orders and a glance at the spread matter more here than with a mainstream index fund.
• The buffer is measured from the start of the October outcome period. Buy mid-period and you inherit whatever protection is left, not a fresh 15%.

• PSMJ The 15% buffer and the cap belong to the full outcome period. Step in mid-period and you inherit whatever cap and buffer remain, not the starting terms.paceretfs.com
• Thinly traded next to the largest buffer funds, so spreads and limit orders deserve more of your attention at the point of entry.
• No regular income stream here: the options structure delivers its result through share price rather than distributions.paceretfs.com

Full LOCT profile⁠

Full PSMJ profile⁠