At a glance
ZHDG charges 0.95% a year, above the 0.85% average of the 1 funds most like it. It has $35.2M in assets; it paid 2.41% of its price in distributions over the past 12 months, annual. Over the past year it returned +5.9% with distributions reinvested (S&P 500: +11.5%); over three years it returned +16.1% a year. At its worst it fell 22.9% in the 2022 bear market (S&P 500: 24.5%), and was back at its earlier high 21 months after the low.
The short version
Zega Buy & Hedge ETF (ZHDG) is an actively managed fund that gets its S&P 500 exposure mainly from options on the SPDR S&P 500 ETF Trust (SPY). Short-term Treasury bills back those positions, and the fund buys put options to soften large market drops. Its 0.95% expense ratio is well above what plain S&P 500 index funds charge. Its hedges did not prevent a 22.06% loss in 2022.
Price history
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ZHDG +5.9% 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 | |
|---|---|---|---|---|---|---|
| ZHDG official prospectus, to Dec 31, 2025 | — | +13.97% | — | — | — | +5.30% |
| ZHDG price data to Oct 27, 2026 | +6.2% | +5.9% | +16.1% | +5.6% | — | +5.9% |
- Over the year to Oct 27, 2026, ZHDG returned +5.9%.
- Its 5-year annualized return was +5.6%.
- Its worst full calendar year was 2022 (-22.1%); its best was 2024 (+18.0%).
- The deepest fall in its price history was 23.3% (Dec 29, 2021 to Dec 28, 2022), recovered by Jul 16, 2024.
Show as a table
| Year | Price data | Prospectus (official) |
|---|---|---|
| 2026 (to date) | +6.2% | — |
| 2025 | +14.3% | +13.97% |
| 2024 | +18.0% | +17.76% |
| 2023 | +13.1% | +12.12% |
| 2022 | -22.1% | -22.06% |
| 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 | Lost 22.8% over that stretch · deepest drop along the way 22.9%, back to its old high 21.1 months after the low |
Dividends and income
Show as a table
| Year | Per share | Change |
|---|---|---|
| 2025 | $0.5800 | +9.4% |
| 2024 | $0.5300 | +96.3% |
| 2023 | $0.2700 | -52.6% |
| 2022 | $0.5700 |
What's inside
As of Jul 31, 2026, the fund held 4 securities; the ten largest made up 23.01% of assets.
| Holding | Weight | |
|---|---|---|
| TREASURY BILL Bonds and notes | 8.14% | |
| TREASURY BILL Bonds and notes | 5.95% | |
| TREASURY BILL Bonds and notes | 5.17% | |
| TREASURY BILL Bonds and notes | 3.75% |
By country
United States 23.01%By issuer
US Treasury 23.01%The bonds mature in 0.3 years on average (weighted by size), with an average coupon of 0%.
Source: N-PORT holdings report as of Jul 31, 2026. Cash, money-market funds and derivatives are shown separately from the securities list.What changed recently
- Over the three months to Jul 31, 2026, investors withdrew a net $566K (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: +4.72%, -1.38%, -0.30%.
How it works
ZHDG is actively managed. The adviser, not an index, decides what to own, using rule-based quantitative models. The goal is exposure equal to 100% of the fund's value in the S&P 500. The fund can get it through call options on the index or on SPY, including customizable FLEX options cleared by the Options Clearing Corporation, or through S&P 500 ETFs. A call option gives the right to buy at a set price. As of July 31, 2026, the main position was one SPY call option with a $220.01 strike price, expiring December 31, 2026, worth about 73.6% of net assets. That strike price is far below the fund's put strikes, so this call moves much like SPY itself.
Most of the rest sat in four short-term U.S. Treasury bills, about 23% of assets with an average maturity of about 0.3 years, plus 1.82% cash. The prospectus also allows high-yield ("junk") bonds and preferred shares. For protection, the fund held SPY put options, which gain value when SPY falls. Their strike prices were $650, $660 and $750, with expirations from September 2026 to June 2027. The fund may also sell out-of-the-money calls for income, which gives up some upside.
The adviser "ladders" the options across several expiration dates over a 12-month period and rebuilds each one as it expires. The aim is to add exposure after declines and lock in gains after rallies. All this trading produced 106% portfolio turnover.
What it really costs
- ZHDG charges 0.95% a year, versus an average of 0.85% for the similar funds below.
- Using the prospectus's standard example, $10,000 invested would cost about $97 in the first year and $1,166 over 10 years (assuming a 5% annual return).
| Cost of $10,000 (SEC example) | 1 yr | 3 yrs | 5 yrs | 10 yrs |
|---|---|---|---|---|
| ZHDG | $97 | $303 | $525 | $1,166 |
Structure and tax notes
- Generates much of its income from selling options (directly or through notes). That income is usually taxed as ordinary income rather than as qualified dividends, and the strategy gives up some upside in strong markets.
In a retirement portfolio
It aims to keep S&P 500 exposure while using put options to soften major declines, though its 2022 record shows that protection has clear limits.
ZHDG launched in July 2021, so it has no record from the 2008 or 2020 crashes. Its one real test was the 2022 bear market. It fell 22.9% from January 4 to October 12, 2022, and did not regain its earlier peak until July 16, 2024. Its deepest drop was 23.3%, and recovery took 18.6 months after the December 28, 2022 low. Anyone forced to sell shares in 2022 would have locked in a large loss.
Later years were steadier: 12.12% in 2023, 17.76% in 2024 and 13.97% in 2025. Income is modest. The trailing yield was 2.41% as of October 27, 2026, paid once a year and usually taxed as ordinary income. Costs run about $97 in the first year on $10,000. Past results don't predict the future, and a retirement plan needs to weigh the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors wanting S&P 500 exposure with put-option hedges who are comfortable with an actively managed, options-based structure and 106% annual turnover.
- Holders of IRAs or other tax-advantaged accounts, where ordinary-income treatment of option-related distributions matters less.
- Investors who accept somewhat smaller swings than the market, given a one-year beta of 0.82 and 11.2% volatility as of October 27, 2026.
Look elsewhere if
- Cost-conscious investors: in the SEC example, the 0.95% expense ratio adds up to about $1,166 over 10 years on $10,000.
- Anyone expecting crash protection: ZHDG lost 22.06% in 2022 and didn't regain its prior peak until July 2024.
- Those needing regular income or a large fund: it pays once a year and had about $35.2 million in net assets as of July 31, 2026.
Close alternatives
Matched by closest holdings overlap from the latest N-PORT reports (no similar fund shares 20% or more of its holdings).
| Fund | Overlap | Cost | Net assets | 1 yr | 3 yr |
|---|---|---|---|---|---|
| ZHDG this fund | — | 0.95% | $35.2M | +5.9% | +16.1% |
| DBMF iMGP DBi Managed Futures Strategy ETF · different strategy | 6% | 0.85% | $3.89B | +21.2% | +10.1% |
Questions investors ask
Did ZHDG protect against losses in 2022?
Not by much. ZHDG lost 22.06% in calendar 2022. Its worst quarter was a 15.53% drop in the quarter ended June 30, 2022. From its December 29, 2021 peak, it fell 23.3% to a low on December 28, 2022, and did not recover that peak until July 16, 2024. The fund launched in July 2021, so it has no record from the 2008 or 2020 crashes.
What does ZHDG actually hold?
Mostly options and Treasury bills. As of July 31, 2026, about 73.6% of net assets was one call option on SPY with a $220.01 strike price, expiring December 31, 2026. Four short-term U.S. Treasury bills made up about 23%. SPY put options for downside protection were about 1.5%, and cash was 1.82%. The fund had about $35.2 million in net assets.
Does ZHDG pay a dividend?
Yes, but only once a year. Over the 12 months to October 27, 2026, it paid $0.58 per share, a trailing yield of 2.41%. Income comes from its fixed income holdings and from selling call options. Option-related income is usually taxed as ordinary income rather than at the lower qualified-dividend rate. That matters more in a taxable account than in an IRA.
What is ZHDG's expense ratio?
ZHDG's expense ratio is 0.95%, all of it management fee, with no fee waiver, according to its prospectus filed August 26, 2026. In the SEC's standard example ($10,000 invested, 5% yearly return), costs total about $97 after one year, $303 after three, $525 after five and $1,166 after ten. When the fund holds other ETFs, their fees are added on top of its own.
What ETFs are similar to ZHDG?
None is a close match by holdings. Based on the latest N-PORT reports, no fund shares 20% or more of ZHDG's holdings. The nearest overlap, about 6%, is the iMGP DBi Managed Futures Strategy ETF (DBMF), which follows a different managed-futures strategy. As of October 27, 2026, DBMF charged 0.85% compared with ZHDG's 0.95%. It returned 21.2% over one year, compared with 5.9% for ZHDG.