Buffered ETFs, which promise investors some downside protection when markets fall, have been around for a few years now.
Also known as defined outcome or structured outcome ETFs, these funds experienced a real-world test in the first quarter of 2020, when the coronavirus pandemic slammed markets and shuttered the global economy. Financial advisors who used these ETFs at the time say they worked exactly as the advisors expected, allowing them to re-assure skittish clients during the worst of the market rout.