Sun, Dec 17, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Dynamic options emerge as volatility mitigator for retail investors

Tuesday, May 14, 2013

amb
Eric Metz
Bailey McCann, Opalesque New York:

After 2008, many investors found their traditionally constructed 60/40 portfolios to be a little weaker than previously thought. Since then, investors find themselves with a variety of new investment products designed to provide greater diversification, although many of them simply add additional equities. Eric Metz, CFA, Portfolio Manager and Derivatives Strategist at RiverNorth Capital Management, says that instead of just reshuffling equities, investors should look at options for portfolio diversification and stabilization.

RiverNorth Capital Management focuses on opportunistic investment strategies including the trading of closed-end funds and volatility, and manages approximately $2.1bn in assets. According to Metz, dedicated options strategies can provide a "third bucket," or asset class that might be able to provide the desired low volatility of fixed income with a high correlation to equities.

He notes that the options market sometimes offers inefficiencies that can be captured and generate alpha that investors wouldn't necessarily see through a traditional equities exposure. RiverNorth recently launched a fund designed to capture these opportunities - the RiverNorth Dynamic Buy-Write Fund (RNBWX).

Different from most other buy-write – also known as covered call - investment strategies, in which an investor buys a single security or portfolio of securities and writes (sells) calls against the underlyi......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Mediobanca acquires majority stakes in Swiss hedge fund[more]

    Komfie Manalo, Opalesque Asia: Listed diversified banking group Mediobanca SpA said it has acquired a majority stake in Geneva-based hedge fund firm RAM Active Investments SA (RAM AI), an active and alternative asset manager offering a range of act

  2. Launches - Ex-BlueCrest team to open over $200m hedge fund, Greg Coffey, a hedge fund star who retired at 41, is eyeing a comeback, Brevan Howard plans Greek funds as bond rally signals revival[more]

    Ex-BlueCrest team to open over $200m hedge fund From Bloomberg.com: A team of traders who left BlueCrest Capital Management earlier this year raised more than $200 million for their own hedge fund focused on Asian stocks, according to a person familiar with the matter. Ovata Capital Manag

  3. North America - Miami could attract hedge funds if SALT deductions axed[more]

    From Law360.com: For years, inertia has been Nitin Motwani's greatest foe in his attempts to lure hedge fund owners in the northeast to Miami, which he has pitched as a tropical low-tax paradise. But with the Republican tax bill proposing to eliminate deductions for state and local taxes, he's sensi

  4. Northleaf Capital Partners closes debut private credit fund on $670M[more]

    Bailey McCann, Opalesque New York: Northleaf Capital Partners has closed its debut private credit fund - Northleaf Private Credit I - on $670 million. The vehicle will invest in private credit transactions in Europe and North America, with a primary focus on lending to private equity-backed compa

  5. ...And Finally - The ongoing gun saga in the U.S.[more]

    From Newsoftheweird.com: As elder members of the First United Methodist Church in Tellico Plains, Tennessee, gathered on Nov. 16 to discuss the recent church shooting in Sutherland Springs, Texas, one of those present asked if anyone had brought a gun to church. One man spoke up and said he c