Dan Cupkovic

Dan Cupkovic is a partner at Cerity Partners , the seventh largest RIA in the country with around $70 billion in assets , and the portfolio manager behind the SWAN ETF. He's been in finance for nearly 20 years, starting at Northwestern Mutual, spending a decade at RE Investments Services as director of investments, and now serving on Cerity's national investment committee. His path to creating SWAN started with a childhood curiosity about money: "My dad was always a very successful architect, but they were never particularly good with money. So that was always where I got an interest." As a kid at his grandmother's house, he watched CNN's ticker tapes "like a different language" and never looked back.

SWAN's Architecture: 90% Safety, 10% Home Runs

The SWAN strategy is elegantly simple in concept, even if the execution involves options complexity. The portfolio is split into two buckets: roughly 90% in investment-grade fixed income (primarily U.S. Treasuries) and 10% in long-dated call options on the S&P 500 , specifically LEAP options with expiration dates in June and December.

"It's 10% home run money with those call options , they give you uncapped upside to the S&P 500 , and 90% safety belt money," Dan explains. The strategy rotates like clockwork: when June arrives, they sell the current June LEAP and roll to the following June. December works the same way. Any excess returns get reinvested into the fixed-income sleeve, and vice versa.

The expected risk-return profile over three-to-five-year horizons: roughly what the 10-year Treasury yields on the fixed income side, plus about 40 to 50% of equity market upside from the options. "Combine those and that's the expected return."

Where SWAN Shines , and Where It Doesn't

Dan is refreshingly honest about when SWAN works and when it struggles. "The most advantageous environments are very, very good positive markets , if the market's up 50%, those call options are going to sing beautifully. And the more the market goes up, the larger that proportion of the portfolio becomes until rebalance." Similarly, in severe downturns like COVID's crash, "the bleeding stops after those call options go to zero. You're left with the basket of Treasuries, which typically hold their value very well and can offset any losses."

Where SWAN doesn't shine: the plus-or-minus 5% zone. "If the market doesn't move in our favor, those options aren't going to pay off because of time value decay. There could be an environment where the market flies ahead a little and we're still down five or seven percent because the call option didn't pay off." The strategy is built for fat tails, not narrow ranges.

How Advisors Use It

Dan sees two distinct usage patterns among advisors. RIAs tend to use SWAN as a permanent 5-20% allocation within a globally diversified model , "that's where it maximizes additional Sharpe ratio to a portfolio" and creates rebalancing opportunities (shaving SWAN in bad years to buy cheap equities). Brokers tend to use it more tactically , as a shorter-term risk-off play for three-to-twelve months when they're worried about turbulence.

Dan clearly prefers the strategic allocation approach. He also notes that some investors use SWAN as a substitute for owning Treasuries outright, given that it provides Treasury-like stability with embedded equity optionality.

Markets and the Case for Diversification

When asked about second-half positioning, Dan advocates strongly for breadth: "You want to create a portfolio that's very strong, that can still get a solid return in many types of markets. Because we don't know if rates are going to stay higher for longer, continue to climb, come back. We don't know if we're going to go into a really ugly recession, get a soft landing."

On AI and technology, he makes a perceptive observation: "If you're Microsoft and you're offering an AI system, you can have a million users, you can have a billion users, and the cost difference isn't that much. The efficiencies of scale are interesting." But he also notes the physical infrastructure buildout behind the hype: "It's like a real estate grab for server farms for AI."

Dan brews his own kombucha, coaches YMCA and CYO basketball, and has a third child on the way , the kind of personal details that remind you these fund managers are real people managing real money for real clients, not just algorithms behind ticker symbols.

The SWAN strategy has spawned ancillary products , ICSWAN (international) and QSWAN (tech-focused) , extending the same hedged-equity concept to different market segments. Dan's partnership at Cerity Partners, with its $70 billion in assets and national investment committee, gives him institutional credibility and resources that most individual fund managers lack. The combination of a massive RIA platform and a specialized hedged-equity product creates a natural distribution channel , Cerity's own advisor network provides built-in demand for a product designed by one of their own investment committee members.

Key Takeaways

• Dan Cupkovic is a partner at Cerity Partners , the seventh largest RIA in the country with around $70 billion in assets , and the portfolio manager behind the SWAN ETF.
• He's been in finance for nearly 20 years, starting at Northwestern Mutual, spending a decade at RE Investments Services as director of investments, and now serving on Cerity's national investment committee.
• The SWAN strategy is elegantly simple in concept, even if the execution involves options complexity.
• The portfolio is split into two buckets: roughly 90% in investment-grade fixed income (primarily U.S.

Listen to the full conversation on Spotify, Apple Podcasts, or YouTube.