ETF Prime · Sep 29, 2026
With Ben Sklar, Portfolio Manager, Index and Derivative Solutions at AllianceBernstein
AllianceBernstein's conservative buffer ETF targets 15% of downside protection every three months. Ben Sklar said that, looking at market returns back to the 1940s, stocks have fallen further than that in a three-month period "maybe 2% of the time."
Many buffer ETFs reset once a year and come in dated series that an investor has to pick from and roll. AB's run as single funds that never expire, reset every quarter, and lock in gains when the market rallies early in the period.
"Getting investors to systematically buy their losers and sell the winners is a challenging thing to do."
Ben Sklar, Portfolio Manager for Index and Derivative Solutions at AllianceBernstein, on ETF Prime, has spent 20 years at the firm and co-manages its three buffer ETFs. His team has run systematic option strategies for 17 years.
The full interview is covered here so you can skip it.
Here are the 9 takeaways that matter.
Key Takeaways
A rebalanced stock-and-cash portfolio can copy a buffer ETF on paper, but Sklar said selling winners and buying losers on schedule is hard for most investors
He called buffers a pre-commitment device against that bias
AB's buffers reset every 3 months, not every 12, so a fresh 10% buffer is never more than three months away
The ratchet locks in an early rally by moving the buffer and the cap up to where the market is
The conservative buffer is not a cash replacement, but it is sized for all but maybe 2% of three-month periods since the 1940s
2022 showed why bonds alone may not protect a portfolio when inflation returns
AB's premium income ETF, INC, targets a 10–12% yearly distribution from a tax-aware stock portfolio plus call option premiums
Much of it may come as return of capital once enough tax losses are harvested
Premium income funds belong in the equity allocation, not fixed income, Sklar said
1. Twenty Years, One Team
The host opened with the scale of the business. He said AllianceBernstein, a manager of more than $900 billion, offers 23 ETFs with nearly $21 billion in assets, all actively managed, and that the lineup has taken in about $6 billion of new money this year.
The team grew from plain index funds into options
Sklar said the Index and Derivative Solutions team started with plain vanilla index funds, which it still manages. That became a custom beta and systematic exposure business, then took on systematic volatility strategies, and began using options around 2009 and 2010.
"So the through line to all of that is we developed systematic tools to help solve client solutions." — Ben Sklar
He joked that the team's name "might be a little underworkshopped or overworkshopped depending on your point of view." He has been at the firm for 20 years and has managed each of the team's investment disciplines over that time.
