SMAY ETF: What Is It? A Complete Guide to Returns, Expense Ratio, Holdings, and Alternative ETFs
The First Trust Best Small Cap Moderate Buffer ETF-May (SMAY) references the price performance of IWM, the Russell 2000 small-cap ETF, and trades an upside cap for downside buffering. When comparing related stocks and funds, it offers a useful reference point for defensive small-cap investing.
SubscribeWhat Is the First Trust Best Small Cap Moderate Buffer ETF-May?
This is a defined outcome ETF that uses FLEX options referencing the price return of IWM to buffer initial downside losses during a set one-year outcome period.
It suits defensive-minded investors who want to participate in the upside potential of small caps while cushioning early losses in a down market.
It is an actively managed ETF run by First Trust.
How Do You Invest in the First Trust Best Small Cap Moderate Buffer ETF-May?
| Item | Details |
|---|---|
| Reference Asset | References the price return of IWM |
| Strategy | Defined outcome strategy based on FLEX options |
| Outcome Period | One year (begins every May) |
| Dividend Frequency | No dividends, due to the option premium structure |
| Total Expense Ratio | 0.90% |
Through a combination of FLEX options referencing the price return of IWM, the fund buffers a defined range of losses that occur early in the outcome period, and in exchange participates in gains only up to a preset cap. Dividends from the reference index are not reflected, because the options are designed around price return.
- A rare buffer structure that references a small-cap index
- Outcome periods that begin every May, allowing entry timing to be spread out
First Trust Best Small Cap Moderate Buffer ETF-May Size and Costs (AUM and Management Fee)
Assets under management (AUM) stand at $110.6M, and the total expense ratio is 0.90% per year.
Compared with other monthly outcome series from the same issuer or with broad-market buffer ETFs, the key differentiator is that the reference index is small caps.
First Trust Best Small Cap Moderate Buffer ETF-May Performance and Trends
1-Year Price Performance
Dividend & Yield
52-Week Price RangeBecause IWM itself consists of small caps, it is more volatile than large-cap benchmarks, and because of the buffer structure, the profit and loss path within the outcome period differs from that of IWM itself.
As interest in the defined outcome ETF category continues, products that use small caps as the reference index remain relatively rare, which has created niche demand.
First Trust Best Small Cap Moderate Buffer ETF-May Pros and Cons
Its strength is that it allows limited participation in small-cap gains while buffering the early portion of a decline. Its weaknesses are the forgone gains above the cap and the complex structure.
💪 Key Strengths
⚠️ Points to Watch
First Trust Best Small Cap Moderate Buffer ETF-May Alternative ETFs and Related Products
The BUFR, BUFD, and BUFQ shown in the table are buffer series from the same issuer that reference large-cap and Nasdaq indexes, and there are also similar defined outcome products from other issuers such as SFLR and PJAN. What sets SMAY apart from these is its different reference index and buffer width. Compared with holding the reference index IWM directly, there is a structural difference: investors accept an upside cap in exchange for a buffer against initial losses.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 BUFR | FT Vest Laddered Buffer ETF | $37.50 | -0.3% | $10.9B | 0.95% | - | +11.6% |
 SFLR | Innovator Equity Managed Floor ETF | $39.11 | -0.1% | $2.2B | 0.89% | 0.25% | +7.7% |
 BUFD | FT Vest Laddered Deep Buffer ETF | $30.41 | -0.3% | $2.2B | 0.95% | - | +9.4% |
 BUFQ | FT Vest Laddered Nasdaq Buffer ETF | $39.64 | +0.0% | $1.7B | 1.00% | - | +12.8% |
 FJAN | FT Vest U.S. Equity Buffer ETF - January | $56.56 | -0.3% | $1.5B | 0.85% | - | +12.2% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
| CBOE | Cboe Global Markets Inc | 3.12% | $340.42 | +3.9% | $35.6B | 26.5 | 0.92% |
First Trust Best Small Cap Moderate Buffer ETF-May Investor Checkpoints
Here are the points to review before investing in SMAY. Because of the buffer structure, the timing of entry and exit during the outcome period and an understanding of the cap and buffer terms greatly affect results, so check them carefully in advance.
| Checkpoint | What to Check | Current Status |
|---|---|---|
| 💵 Total Expense Ratio | Compare the fee level with typical index ETFs | Needs verification |
| 📅 Outcome Period | Understand the one-year cycle that begins every May | Regular reset maintained |
| 📈 Upside Cap | Check the preset cap level and how much of it has been used | Varies by period |
| 🛡️ Buffer Range | Review the size of the initial loss buffer and the remaining cushion | Differs by outcome period |
In ranges above the upside cap, returns may lag IWM, and trading in the middle of an outcome period risks the buffer not working as designed.
This defined outcome product suits investors who want a buffer against the early part of a small-cap decline and can accept an upside cap. It is advisable to understand the structure thoroughly and enter at the start of an outcome period.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
This article reflects information as of July 2, 2026.
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