It tracks the FTSE Laddered Power Buffer Strategy Index and holds Innovator's 12 monthly Power Buffer ETFs in equal portions. Each underlying ETF is structured to protect against S&P 500 declines up to a set level, so the portfolio as a whole forms a permanent protective layer.

It suits conservative investors who want to participate in stock market gains while keeping a safeguard in place at all times against sudden crashes.

It is a passively managed (index-tracking) ETF launched in 2016 by Innovator (Innovator ETFs).

By holding buffer ETFs whose maturities fall one month apart in sequence, the fund spreads out the points at which buffers reset. As a result, even during sharp market swings, part of the total assets is always forming a fresh layer of protection, which manages timing risk effectively.

• Timing risk is spread out through the ladder structure
• A constant shield against S&P 500 declines

Assets under management (AUM) stand at $1.1B, and the expense ratio is 0.89% per year.

Because it is a fund-of-funds structure that includes the management fees of the underlying ETFs, its fees are relatively high compared with a typical index ETF, but it spares investors the hassle of buying and managing individual buffer ETFs directly.

In periods when the index rises gradually, the cap on upside may cause it to trail the market's return. When volatility increases or declines appear, however, the buffer effect has delivered solid protection relative to the index.

Late in a bull market, when concerns about an overheated market grow, money seeking to lock in stable returns tends to flow in. It is especially favored as a downside protection tool for long-term capital such as retirement pensions.

It offers a systematic safety net in the form of constant downside protection, but investors need to understand the structural feature that upside gains are limited to a certain level.

BUFR, BUFD, and others shown in the table are competing products that use similar laddered buffer strategies, and they differ in how they set the buffer level and the cap. If you want protection on the Nasdaq market, BUFQ can be an alternative, and if you want to focus on protection in a specific month, you can choose an individual monthly ETF such as PJAN. If you prefer more active management, SFLR is also worth considering.

BUFF offers investors who pursue "investing without losing" a reasonable alternative that keeps the earnings opportunity of the S&P 500 Index while managing the risk of a falling market.

Because the structure limits upside gains, investors may feel a sense of relative deprivation when the market rallies explosively. You should also check whether distributions are paid out, from a tax perspective.

It is a product worth recommending to investors who value stable asset allocation and who want to pursue, over the long term, an investment that frees them from the fear of market declines and gives them psychological peace of mind.