At a glance
KSEP charges 0.79% a year, below the 0.86% average of the 7 funds most like it (the cheapest of 8). It has $24.0M in assets, the 8th largest of that group. Over the past year it returned +10.4% with distributions reinvested (S&P 500: +11.5%), 7th of those 8 funds.
The short version
Innovator U.S. Small Cap Power Buffer ETF - September (KSEP) is a buffer ETF built from options on the iShares Russell 2000 ETF, which tracks about 2,000 small U.S. companies. Over each one-year period starting September 1, it aims to absorb the first 15% of losses in exchange for capped gains (17.20% before fees for the period ending August 31, 2026). Its 0.79% expense ratio ties for lowest among eight buffer funds compared.
Price history
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KSEP +10.4% over the year to Oct 27, 2026, total return with distributions reinvested.
How it has behaved
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | Since start | |
|---|---|---|---|---|---|---|
| KSEP official prospectus, to Dec 31, 2024 | — | +9.10% | — | — | — | +7.89% |
| KSEP price data to Oct 27, 2026 | +10.2% | +10.4% | — | — | — | +10.3% |
- Over the year to Oct 27, 2026, KSEP returned +10.4%, 7th of 8 among similar funds.
- Its worst full calendar year was 2025 (+8.5%); its best was 2025 (+8.5%).
- The deepest fall in its price history was 14.9% (Nov 25, 2024 to Apr 8, 2025), recovered by Aug 22, 2025.
Show as a table
| Year | Price data | Prospectus (official) |
|---|---|---|
| 2026 (to date) | +10.2% | — |
| 2025 | +8.5% | +9.10% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Before this security existed |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Before this security existed |
What's inside
As of Jul 31, 2026, the fund held 0 securities; the ten largest made up 0% of assets.
| Holding | Weight |
|---|
By country
By asset type
What changed recently
- Over the three months to Jul 31, 2026, investors withdrew a net $1.5M (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: +1.91%, +1.26%, +0.59%.
How it works
KSEP's results are tied to the iShares Russell 2000 ETF (IWM), which tracks roughly the 2,000 smallest companies in the Russell 3000 Index, weighted by market value. As of July 31, 2026, the fund held no IWM shares, just cash and four FLEX options on IWM: exchange-listed contracts with customized terms. One moves almost one-for-one with IWM. A pair of put options, which pay off as prices fall, provides the buffer. A sold call option, which gives away gains above a set level, creates the cap.
The options cover a one-year outcome period. From September 1, 2025 to August 31, 2026, the aim was to match IWM's gains up to a 17.20% cap and absorb the first 15% of its losses, before fees. After the 0.79% fee, those figures were 16.41% and 14.21%. Losses beyond 15% pass through one-for-one: before fees, a 20% IWM drop means a 5% fund loss, and a 50% drop a 35% loss.
When a period ends, the fund cashes out its options and buys new ones expiring about a year later. Each new period gets a new cap. The outcomes apply only to shareholders who hold for the full period. Buying mid-period, selling early, or trading at a price away from the fund's net asset value can produce very different results.
What it really costs
- KSEP charges 0.79% a year, versus an average of 0.86% for the similar funds below (1st of 8, cheapest first).
- Using the prospectus's standard example, $10,000 invested would cost about $81 in the first year and $978 over 10 years (assuming a 5% annual return).
| Cost of $10,000 (SEC example) | 1 yr | 3 yrs | 5 yrs | 10 yrs |
|---|---|---|---|---|
| KSEP | $81 | $252 | $439 | $978 |
Structure and tax notes
- Uses options to limit losses within a range (the buffer) in exchange for a cap on gains over each outcome period; results depend on when you buy relative to the period start.
In a retirement portfolio
It offers small-company stock exposure with a cushion against the first 15% of losses over each one-year period, rather than broad, core market exposure.
KSEP launched in September 2024, so its record doesn't include the 2008, 2020 or 2022 downturns. Its only full calendar year, 2025, returned 9.1%. Its deepest drop, 14.9%, ran from November 25, 2024 to April 8, 2025, with a full recovery about 4.5 months later, on August 22, 2025. The buffer is built for full-period holders, and that drop came mid-period: anyone who invested at the peak and cashed out at the low lost about 14.9%. Losses beyond 15% get no cushion.
It has no recorded distributions, so any cash must come from selling shares, possibly in a down market. Its 0.79% expense ratio is below the 0.86% average for similar buffer funds; the SEC's standard example shows $81 in costs in year one and $978 over 10 years on $10,000. Past results don't predict future ones, and a plan should weigh the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors wanting small-company stock exposure who will accept a cap on gains (17.20% before fees through August 31, 2026) for a 15% loss buffer.
- Patient holders able to invest near September 1 and stay the full year, since the stated buffer and cap apply only to full-period shareholders.
- Cost-conscious investors comparing buffer funds: its 0.79% expense ratio ties for lowest among the eight compared, below the 0.86% peer average.
Look elsewhere if
- Income seekers: KSEP has no recorded distributions, and as of July 31, 2026 it held options rather than dividend-paying shares.
- Anyone who may need to cash out mid-period: the fund fell 14.9% between November 2024 and April 2025 despite its 15% buffer.
- Those wanting a long record or large fund: KSEP dates from September 2024 and had about $24 million in assets on July 31, 2026.
Close alternatives
Matched by other buffer (defined-outcome) funds, largest first.
| Fund | Cost | Net assets | 1 yr | 3 yr |
|---|---|---|---|---|
| KSEP this fund | 0.79% | $24.0M | +10.4% | — |
| BUFR FT Vest Laddered Buffer ETF | 0.95% | $10.49B | +11.6% | +16.8% |
| BUFD FT Vest Laddered Deep Buffer ETF | 0.95% | $2.04B | +9.5% | +13.9% |
| PJAN Innovator U.S. Equity Power Buffer ETF - Ja… | 0.79% | $1.44B | +10.5% | +14.8% |
| PDEC Innovator U.S. Equity Power Buffer ETF - De… | 0.79% | $984.1M | +11.6% | +14.9% |
| FDEC FT Vest US Equity Buffer ETF - December | 0.85% | $1.31B | +12.9% | +18.5% |
| FJAN FT Vest US Equity Buffer ETF - January | 0.85% | $1.47B | +12.3% | +17.4% |
| FFEB FT Vest U.S. Equity Buffer Fund - February | 0.85% | $1.42B | +12.9% | +18.6% |
Questions investors ask
What are KSEP's cap and buffer?
For the outcome period from September 1, 2025 to August 31, 2026, KSEP's cap was 17.20% and its buffer covered the first 15% of losses in the iShares Russell 2000 ETF, both before fees. After the 0.79% fee, they were 16.41% and 14.21%. Losses beyond 15% pass through one-for-one, so a 20% drop in the ETF means a 5% fund loss before fees. Each new period gets a new cap, and these outcomes aren't guaranteed.
What happens if I invest in KSEP after the outcome period starts?
Results can differ sharply from the stated cap and buffer, which apply only to shareholders who hold from the first day of an outcome period to the last. Depending on how the price has moved since the period began, a later investor may have less room before the cap or less buffer protection. Innovator posts daily updates at innovatoretfs.com/ksep. Interim swings also matter: the fund fell 14.9% between November 25, 2024 and April 8, 2025.
Does KSEP pay dividends?
No. KSEP has no recorded distributions. As of July 31, 2026, it held FLEX options on the iShares Russell 2000 ETF rather than the ETF's shares, and options don't pay dividends, so payouts from the index's small companies don't reach KSEP holders. Its buffer is measured against the ETF's share price. Anyone who needs cash from this holding would have to raise it by selling shares, which can mean taking a loss mid-period.
What's the difference between KSEP and PJAN?
The biggest difference is the market underneath. KSEP's options reference the iShares Russell 2000 ETF, which holds small U.S. companies. PJAN, Innovator's U.S. Equity Power Buffer ETF - January, comes from the same series but, as its name indicates, targets U.S. stocks broadly and starts its outcome period in January. Both charge 0.79%. In the year to October 27, 2026, KSEP returned 10.4% and PJAN 10.5%. PJAN is much larger: about $1.4 billion in net assets as of July 31, 2026, versus about $24 million.
Is KSEP good for retirement?
It may fit as a small part of a retirement portfolio rather than a core holding. KSEP offers small-company exposure with a cushion against the first 15% of losses in the iShares Russell 2000 ETF over each one-year period, for investors who hold full periods. The trade-offs: capped gains, no recorded distributions, a record starting in September 2024, and about $24 million in net assets as of July 31, 2026. Under the SEC's standard example, costs come to $81 in the first year on $10,000.