Accelerated Return Strategy (ARS)

Accelerated Return Strategy (ARS) is a long/short equity strategy that seeks capital appreciation and alpha generation under certain environments with similar volatility to the broader U.S. large cap equity market by following a disciplined and systematic investment process.

The returns generated by the strategy are derived from two distinct elements; returns from directional market movements and returns from option premium or income.

A Complement to Your Existing Equity Allocation

 

 

Expectations
  • Designed to produce mid teen to high twenty percent range in rising markets with positive alpha in most markets.

 

Expectations
  • Losses will be no worse than S&P 500.

 

Expectations
  • Can produce positive returns on account of systematic monthly rolling nature which takes advantage of changing market conditions.
Portfolio Construction
Return Drivers
Directional
  • Market Exposure with Return Enhancement
  • Deep in the Money Call Option
  • At the Money Call Option

 

Income
  • Option Premium Collection
  • Short Call Option
Role of ARS in Portfolio Construction
  • Express investors’ more positive view on the market without any increase in risk or volatility over owning the S&P 500.
  • Portfolio diversifier, improve overall alpha generation of portfolio in most markets.
  • Provide greater liquidity with full holding transparency, no lock-up period and low fees relative to hedge funds and other alternative investments.
  • Achieve better balance of overall risk and return, and improve upside/downside capture.
Risk Control Elements
  • Time Series Diversification.
  • Investment diversified across monthly maturities.
  • Eliminates “whipsaw effect” in choppy markets.
  • No Credit or Counter Party Risk
  • Every security is listed and traded publicly.
  • No Leverage.
  • No borrowing.
  • Liquidity and Transparency.
  • All investments are exchange-traded and are priced daily.
  • All investments have daily liquidity.

 

Past performance is not a guarantee of future results. This commentary has been prepared for informational purposes only. Nothing contained herein should be construed as (I) an offer to sell or a solicitation of an offer to buy any security or (II) a recommendation as to the advisability of investing in, purchasing or selling any security or pursuing a particular investment strategy. Opinions and estimates are as of the date of publication and are subject to change without notice. Forward-looking statements are based on current views and assumptions and may involve market risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The material contained herein has been prepared from sources believed to be reliable but we make no guarantee as to its accuracy or completeness. Investors should consider their individual circumstances, investment goals and risk tolerance prior to making investment decisions.

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