March 27, 2013
Attain Capital
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Our newsletter this week is taking a closer look at a love story that had seemed finished a while ago. But this relationship has been building back up for several years now: the “on again, off again” investor love affair with option selling programs. We last visited this peculiar love story in July of 2009 when the affair was decidedly off, with option selling programs having shed about 60% of their assets under management due mainly to losses as volatility spiked in 2007 and 2008. Many option sellers were sent packing – or at the very least sleeping on the couch – as investors burned by big losses called it quits with their one-time sweethearts.
But fast forward to the present, and we are seeing a rebound of sorts in the popularity and performance of option selling programs. After falling nearly $600 million during the financial crisis, assets under management among option selling programs focused on individual investors have risen about $250 million over the past four years. It would seem the flame has been rekindled:
Love may be a many-splendored thing, but this is one affair fraught with a history of pain. Have we seen the last of the troubled days – are we witnessing the renewal of a blissful relationship? Or is this just the 2nd honeymoon that’s destined to end with another big blowup? Read on to find out.
Disclaimer
The performance data displayed herein is compiled from various sources, including BarclayHedge, and reports directly from the advisors. These performance figures should not be relied on independent of the individual advisor's disclosure document, which has important information regarding the method of calculation used, whether or not the performance includes proprietary results, and other important footnotes on the advisor's track record.
The programs listed here are a sub-set of the full list of programs able to be accessed by subscribing to the database and reflect programs we currently work with and/or are more familiar with.
Benchmark index performance is for the constituents of that index only, and does not represent the entire universe of possible investments within that asset class. And further, that there can be limitations and biases to indices such as survivorship, self reporting, and instant history. Individuals cannot invest in the index itself, and actual rates of return may be significantly different and more volatile than those of the index.
Managed futures accounts can subject to substantial charges for management and advisory fees. The numbers within this website include all such fees, but it may be necessary for those accounts that are subject to these charges to make substantial trading profits in the future to avoid depletion or exhaustion of their assets.
Investors interested in investing with a managed futures program (excepting those programs which are offered exclusively to qualified eligible persons as that term is defined by CFTC regulation 4.7) will be required to receive and sign off on a disclosure document in compliance with certain CFT rules The disclosure documents contains a complete description of the principal risk factors and each fee to be charged to your account by the CTA, as well as the composite performance of accounts under the CTA's management over at least the most recent five years. Investor interested in investing in any of the programs on this website are urged to carefully read these disclosure documents, including, but not limited to the performance information, before investing in any such programs.
Those investors who are qualified eligible persons as that term is defined by CFTC regulation 4.7 and interested in investing in a program exempt from having to provide a disclosure document and considered by the regulations to be sophisticated enough to understand the risks and be able to interpret the accuracy and completeness of any performance information on their own.
RCM receives a portion of the commodity brokerage commissions you pay in connection with your futures trading and/or a portion of the interest income (if any) earned on an account's assets. The listed manager may also pay RCM a portion of the fees they receive from accounts introduced to them by RCM.
Limitations on RCM Quintile + Star Rankings
The Quintile Rankings and RCM Star Rankings shown here are provided for informational purposes only. RCM does not guarantee the accuracy, timeliness or completeness of this information. The ranking methodology is proprietary and the results have not been audited or verified by an independent third party. Some CTAs may employ trading programs or strategies that are riskier than others. CTAs may manage customer accounts differently than their model results shown or make different trades in actual customer accounts versus their own accounts. Different CTAs are subject to different market conditions and risks that can significantly impact actual results. RCM and its affiliates receive compensation from some of the rated CTAs. Investors should perform their own due diligence before investing with any CTA. This ranking information should not be the sole basis for any investment decision.
See the full terms of use and risk disclaimer here.
March 28, 2013
A colleague of mine used to say that investing in options writing programs was like “picking up pennies in front of a steam roller”.
Diamond Capital is on a pretty good run though. Tempting…