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What does it mean to rebalance a buffered ETF?​

For buffered ETFs, such as the ARK Defined Innovation Exposure Term ETFs (ARK DIET), rebalancing means resetting the ETF’s options positions at the start of a new 12-month outcome period. This involves: 
  • Setting new strike prices for the put and call options 
  • Updating the buffer, hurdle, and participation rate based on current market conditions 
  • Relaunching the defined outcome for a new term 

      It’s not a reactive change during the year—it’s a planned update that happens once per cycle, ensuring a fresh and relevant strategy going forward.