3 ETFs to stabilize a portfolio amid volatility: Amplify CEO

With two tech-fueled market sell-offs occurring within the last month, volatility (^VIX) can be a concern for many investors who are hoping for stability in their portfolios.

Amplify ETFs Founder and CEO Christian Magoon joins Wealth! to give insight into which ETFs can help during times of volatility.

Magoon advises clients to re-examine "core equity positions" in "this volatile period in the fall." September is historically a tough month for both equity markets (^DJI, ^IXIC, ^GSPC) and bitcoin (BTC-USD) in the crypto space.

"And instead of maybe going just 100% long, looking at a high-quality covered call equity strategy, that would give you kind of the benefit of higher quality names, but then also the ability to have covered call income from those names," Magoon says, "which acts as a hedge during kind of downward market environments, and also kind of benefits in terms of more option income as markets become more volatile."

Magoon elaborates on a potential avenue for investors looking to hop on to the weight-loss drug craze: "We launched the first ETF that tracks this GLP-1 weight loss drug category. That's the Amplify drug Weight Loss Drug and Treatment ETF (THNR)... So it's... the only index based ETF to track this segment that owns the companies that are manufacturing GLP-1s and that are in clinical trials on the GLP-1 side. In addition, it owns some of the enablers of this technology. The companies that are making the injection pens, doing the testing, or third party manufacturing of the drug."

For more expert insight and the latest market action, click here to watch this full episode of Wealth!

This post was written by Nicholas Jacobino

Video transcript

Well, September is no stranger to volatility and the swings have already begun after Tuesday's steep, sell off all three major averages.

They're rebounding from some earlier losses, but a busy few days of econ data ahead, including the August Jobs report on Friday that could further complicate the path forward for more on how to position yourself for a volatile September.

We've got Christian mcgoon, founder and CEO of amplify ETF s who's us as part of this week's ETF report brought to you by Invesco QQQ.

Christian.

Great to see you.

Great to catch up once again.

So first and foremost, here, as we're tracking some of the volatility, some of the swings as we've now crept back into positive territory, we'll see if we can hold on to that as we go on throughout some of the economic data readings, the rest of this week.

What are the ETF plays that investors would be apt to keep on their docket.

Yeah.

Hey, Brad, good to see you.

Thanks for having me on and I, you know, I think one of the areas going into September and October, you know, this volatile period in the fall, that's really accentuated during election season would be looking at your core equity position.

And instead of maybe going just 100% long, looking at a high quality covered call equity strategy that would give you kind of the benefit of higher quality names, but then also the ability to uh have covered call income from those names, which acts as a hedge during kind of downward market environments and also kind of benefits in terms of more option income uh as markets become more volatile.

So I think that would be a great compliment or uh even an alternative to a long only equity portfolio.

We have an ETF Devo divo and uh you know, it's five star rated and does just that owns high quality blue chip dividend paying stocks, it's actively managed and then the managers have the ability to write covered calls on the portfolio.

So you're not just dependent on capital appreciation for your total return, you also get dividend income and option income.

We think that's kind of a, a great way to have some a belt and suspenders, so to speak, going into this volatile fall season.

You know what one of the sexiest trades in the market to talk about has been this A I trade and the A I theme and all the ETF S that really surround it.

But one of the other sexy trades is this weight loss drug market for both health and for any other reasons that people are tapping into some of the G LP ones and the associated type of uh solutions that are being put into market here.

And this is something that you're tracking.

How are you playing the weight loss drug market via ETF S?

Yeah, so we launched the first uh ETF that tracks this G LP one weight loss drug category.

Uh that's the amplify uh uh drug, uh weight loss drug and treatment.

ETF ticker Thnr Thinner.

So it's an index based ETF the only index based ETF to track this segment that owns the companies that are manufacturing G LP ones and that are in clinical trials on the G LP one side.

In addition, it owns some of the enablers of this technology, the companies that are making the injection pens doing the testing or third party manufacturing of the drugs.

So, you know G LP one drugs could be the largest category of drugs ever because of the total addressable market, right?

So many people think of them as just weight loss drugs, but now Brad, they're being prescribed, people have uh cardiovascular issues also for diabetes.

And when you start looking at who qualifies for that just in the US, it's close to 70% of the population.

Now, you know, these drugs have been in short supply, the supply is starting to ramp up insurance coverage is starting to become more robust.

So we think that this is a great kind of early innings play for thematic investors and maybe has kind of the uh the uh appeal to be able to withstand some of this market volatility because we expect to see continued good news from clinical trials and breakthroughs in this space.

And you know, by that, I mean, not just injecting drugs, maybe using them in pill format, maybe only being able to take a pill once a week or once a month.

And of course, other types of uses beyond kind of the big three, which includes maybe Alzheimer's sleep apnea and addictive behaviors.

So this G LP one trend is a big deal and we think our ETF thnr thinner uh is a great way to play it from an index standpoint, you know, why choose one or two stocks instead you can own the basket that's professionally selected.

And just lastly while we have you here, another core theme that you're tracking is cyber security here.

There's been a lot of movements within cyber as of late, whether that be crowd strike or what we've heard from some of the other entities that are really trying to make sure that even as generative A I means more data centers, more powerful data centers that there's more cyber security put around that here.

What's the play there?

Yeah, we really think this is a resilient theme, bread going into the election.

I mean, there's a lot of geopolitical issues both internally and externally.

Uh this morning, the FBI kind of announced a North Korean threat against companies including I guess, amplify ETF S companies that are involved with Cryptocurrency, uh ETF S and Cryptocurrency funds of which we have exposure there.

So, uh you know, these cyber attacks and criminals are becoming more sophisticated.

Uh This is an essential spend in the technology area.

So our, our ETF Hack H AC K is the first cybersecurity ETF to launch, it's the original one here in the US index based.

And again, it owns kind of the broad-based uh companies in this sector.

And we think the demand for this is very inelastic uh companies, uh governments uh individuals, we can't uh not spend on cybersecurity.

The risks are too high.

So we think this is a that is really worth taking a look at for those who are technical uh uh and uh traders and looking at the chart, if you look over the last three years, there is seemingly a cup and handle forming.

So we could see a breakout.

We're at relative highs here for cybersecurity a little bit off.

But we again, we think a resilient theme to kind of take you through the fall and into the next year.

Christian mcgoon, who is the founder and ceo of amplify ETF S Christian.

Great to catch up with you.

Once again.

Thanks so much for taking the time.

Thanks, Brad.