Goldman Goes All In on Buffer ETFs with $2B Innovator Deal

Less than a year after starting to dabble in buffered ETFs, Goldman Sachs is about to become one of the biggest names in the game.

The Wall Street giant has agreed to buy defined-outcome ETF firm Innovator Capital Management for $2 billion, it announced Monday. Expected to close during the second quarter of 2026, the purchase will catapult Goldman from its status as a newcomer to the second-largest asset manager in the category, adding $28 billion in assets and putting it just behind First Trust, which manages about $33 billion in its target-outcome products. The three buffer ETFs Goldman Sachs Asset Management offers have been on the market for less than a year and represent about $36 million.

Innovator’s growth “is super impressive,” said Bryon Lake, global head of third party wealth at Goldman Sachs Asset Management. “Us bringing the Goldman reach, scope and capabilities to create some tailwinds on that business — we got excited about that.”

Uncertainty Is the Future

When Innovator added its first ETFs in 2018, the Covid-19 pandemic was still a couple of years away, but that event ended up supercharging the defined-outcome category. It fits a need for investors who want market exposure but, faced with volatility, want some cushion from losses. The current US market for such products sits at about $69 billion, though it is expected to grow. Cerulli anticipates it will cross $334 billion by 2030. Obviously, Goldman sees potential there as well. The company “has refocused its ETF efforts in 2025 and seen strong growth in part from their options-based ETF strategies like GPIQ and GPIX,” said Todd Rosenbluth, head of research and editorial at TMX VettaFi. The Innovator acquisition is “a key catalyst,” he added. 

The company has yet to decide whether to keep the Innovator brand or fold it into Goldman’s branding, though it will have an answer for that before the deal closes, Lake said. Innovator’s more than 60 employees are expected to join Goldman.

It’s a market that is growing quickly:

• There are now more than 500 defined-outcome ETFs among 28 issuers.
• Innovator and First Trust represent about 75% of that, by assets.
• About 10% of financial advisors report using them, data from BlackRock show.

The Story’s Getting Old. Though defined-outcome ETFs have strong selling points for risk-averse investors during volatility (like that seen earlier this year around tariffs), the case for them may be stronger for retirees and near-retirees. With an estimated 10,000 people reaching retirement age every day, there will be more and more potential investors. 

Innovator has “an incredible distribution team that is expert on selling sophisticated products and working with clients,” Lake said. “They are obsessed with clients in the way that Goldman is … This one made a ton of sense to us.”