Bloomberg Surveillance · Friday, September 25, 2026
Karan Sinha explained that target outcome or defined outcome funds use derivatives to offer investors specific future returns with protected downside. For instance, a fund might offer 10% downside protection over a year while capping upside participation, providing a higher level of certainty for investors seeking specific financial goals.
“So our target outcome fund defines the target defines very specifically what you're going to get in a certain period of time in the future so it could be about a year from now and you say here's a fund that gives you access to the broad market, S & P 500, and certain part of the downside is protected.”
“So let's say about 20% of the losses of the S & P 500, the first 20%, you're not going to participate in that. And so what ends up happening is if you buy the fund, a year later, market's down 12%, the fund's flat before fees and expenses.”