Two new BlackRock “Buffer” US equity ETFs make their debut on the LSE and Borsa Italiana

Both offer exposure to US large-cap equities as represented by the S&P 500, with a mechanism providing partial or total protection against falls in the index over an annual performance period.

With these two listings, BlackRock completes the “June” series of its European range of Buffer ETFs – the family of outcome-based ETFs that the US asset manager launched in UCITS format from autumn 2025 and has since progressively expanded to include performance periods starting in different months of the year.

The two new funds at a glance

Both funds are actively managed and aim to track the performance of the S&P 500 Index, excluding dividends, up to an approximate maximum percentage of the index’s positive performance (the ‘Upper Limit’ or cap), whilst seeking to provide a level of protection against the index’s negative performance (the ‘Approximate Buffer’ or buffer) should the shares be held from the start to the end of a specified one-year performance period.

The difference between the two sub-funds lies in the extent of the protection. The Moderate Buffer (ticker TENJ) aims to protect against approximately 10 per cent of the index’s negative performance from the start date, net of fees and expenses. The Max Buffer (ticker MAXJ) aims to protect against approximately 100 per cent of the index’s negative performance over the same time period, again net of fees and expenses. In both cases, the protection is designed for investors who hold the units for the entire performance period, which for the “Jun” series runs from June to June each year.

How the cap and buffer mechanism works

The rationale behind Buffer ETFs is to trade off a portion of the upside potential for a reduction in downside risk. The fund maintains a long exposure to the S&P 500 and combines this with an options strategy: the purchase of put options provides protection against falls (the buffer), whilst the sale of call options finances the cost of that protection and sets a ceiling on gains (the cap). The wider the buffer required, the lower the cap tends to be: in the ‘Max’ version, where the protection covers the entire fall in the index, the potential upside is significantly lower than in the ‘Moderate’ version.

In BlackRock’s UCITS range, exposure to US equities is achieved through total return swaps, combined with listed options to implement the predefined outcome strategy. At the end of each performance period, both the cap and the buffer are automatically recalibrated based on current market conditions, and a new annual period begins.

The exact level of the cap is set at the start of each performance period and depends on the option prices at that time, and therefore on implied volatility and interest rates. For historical reference, at the launch of the first European versions, the Max sub-fund with a September–September period had a cap of around 7% alongside full protection, whilst the Moderate version with a December–December period offered a cap of over 16% alongside a 10% buffer. The actual figures for the June 2026–June 2027 period for the two new sub-funds are published by BlackRock on the iShares product pages.

What investors need to know

A few points are worth noting. Firstly: the protection and the cap are defined relative to the starting point of the performance period. Anyone purchasing units after the period has already begun will find that the remaining buffer and upside potential differ from the nominal figures, depending on how much the index has already moved. Secondly: the protection is net of fees and expenses; therefore, even in the ‘Max’ version, an investor holding the units for the entire period will still bear the fund’s costs. Thirdly: the benchmark is the price return of the S&P 500, excluding dividends; the investor therefore forgoes the contribution from dividends, which historically accounts for a significant portion of the index’s total return. Fourthly: selling units before the end of the performance period may produce results different from those expected, as the value of the options in the portfolio fluctuates over time.

In return for these constraints, the two instruments offer a risk-return profile defined in advance over an annual horizon, with the liquidity and transparency typical of the ETF format and a cost – 0.50 per cent per annum – lower than that of many structured products with similar objectives.

The context: the iShares Buffer range in Europe

Buffer ETFs originated in the US market, where the defined-outcome ETF category has gained traction particularly amongst investors approaching retirement who wish to maintain exposure to equities whilst limiting downside risk. BlackRock entered this market in June 2024 with the US launch of the iShares Large Cap Max Buffer Jun ETF, the first product in a domestic range that was subsequently expanded to include moderate-protection series and ‘laddered’ versions with staggered maturities.

In Europe, the debut came in autumn 2025, with the listing of the iShares US Large Cap Max Buffer Sep UCITS ETF and the iShares US Large Cap Deep Buffer UCITS ETF, the latter offering quarterly protection against falls in the range of -5% to -20%. The range was subsequently expanded to include the Max and Moderate series with a December-to-December period, which were listed on Borsa Italiana on the first trading day of 2026, and the series with a March-to-March period. With the two sub-funds listed today, the product range now covers annual performance periods starting in four different months of the year, allowing investors to choose the entry window closest to the time of purchase or to independently build a ladder of protection with staggered maturities.

At the European launch of the range, Manuela Sperandeo, Co-Head of iShares Europe at BlackRock, emphasised how outcome ETFs offer investors greater clarity on expected outcomes and how the extension of these strategies to the European market addresses the dual need to seek growth and manage risk in an unpredictable market environment. The fund manager’s stated aim is to make approaches – which in Europe have traditionally been offered via structured products and certificates – accessible within a listed UCITS framework.

The two new ETFs are domiciled in Ireland and authorised by the Central Bank of Ireland.