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This ETF from Neuberger Berman blends options and bonds for a balanced approach to risk and return.

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Navigating today’s market can feel like a challenge, especially when balancing growth and stability. The NBOS ETF offers an approach that combines options strategies with fixed income investments, aiming to provide steady returns while managing risk.
In this article, we’ll explore how NBOS ETF works and whether it might be a good fit for investors looking for a more measured approach to portfolio management.
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The Neuberger Berman Option Strategy ETF (NBOS) works by using a strategy called writing collateralized put options, primarily on U.S. stock indices like the S&P 500® and similar indices or ETFs. In simple terms, when the fund sells these put options, it's essentially agreeing to buy the underlying assets (like the S&P 500®) if their prices fall to a certain level. In exchange for taking on this obligation, the fund receives a premium, which is a payment that can generate returns.
In addition to writing put options, the fund also invests in fixed income instruments such as U.S. Treasury securities. These investments help lower the overall volatility compared to just holding the stock index directly. By combining the premium from selling put options with the stability of fixed income investments, the fund aims to balance risk while providing steady returns.
It’s designed to perform well in different market conditions, especially when markets are flat or declining, and it provides some income opportunities even during times of volatility.
NBOS trades on the NYSE and has a net expense ratio of 0.56%.
NBOS is an option-based strategy that seeks risk-efficient returns and aims to provide a diversifying source of yield for investors through collateral and option premium income. NBOS can potentially mitigate and monetize common portfolio challenges in a single trade.
The ETF's passive management strategy can result in lower management fees, making it a cost-effective investment. Periodic rebalancing ensures alignment with the portfolio objectives, maintaining its risk/ return profile.
With daily disclosed holdings, the ETF provides transparency and ease of access, allowing investors to gain exposure to a diversified portfolio of stocks through a single investment.
It is suitable for long-term growth, risk management, and cost-conscious investors who prefer a straightforward investment strategy without the need for frequent trading or active management.
Neuberger Berman is a private, independent, employee-owned investment management firm founded in 1939. With a focus on delivering long-term performance, the firm offers a broad range of investment strategies, including equity, fixed income, and alternatives. Neuberger Berman's active ETF suite leverages the firm's deep expertise and research-driven approach to provide investors with dynamic, actively managed investment solutions. These ETFs aim to capture alpha through tactical asset allocation and rigorous security selection, catering to a variety of investment goals and risk profiles with a goal to provide access to Neuberger Berman's institutional quality investments in an investor-friendly wrapper.
Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.
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