- We use options.
Over the last 10 years, option contract trading volume has increased 375%1. This sustained surge in liquidity has added greater pricing certainty to a derivative already arguably the most versatile investment vehicle traded on public, regulated markets.
By customizing the many characteristics of any option position, ZEGA Financial strives to achieve a level of precision managing portfolio risk that exceeds more common approaches like diversification (though we believe in that, too!). As an advisor, you can then more clearly target risk-weighted returns that match your client’s current situation. Off-the-rack turns into custom-tailored.
Plus, options can turn volatility into an additional income stream. That’s one of our investment strategies.
- We hedge equity investments and generate income.
At ZEGA we do two things: We hedge equity investments and we manage alternative income strategies. We use options to do both (along with some low-cost ETFs). Our specialization, our focused strategies, allows us to look deep into the numbers. It allows us to know the calculus underlying certain market moves, not to predict a specific market—no one can do that consistently—but to quantify the risk associated with the targeted return.
We distribute our expertise three ways: sub-advisory services, wealth management, and fund development.
- We bring clarity to risk, returns.
As the founders of ZEGA, Jay (Pestrichelli) and I (Wayne Ferbert), first cut our teeth and then reached the executive suite during the dot.com craze. We specialized in delivering institutional trading tools to retail clients. To do so, we learned to break down the complexity of investing in the stock market into manageable chunks. We created rules, you might say.
Upon breaking out on our own, the first thing we did was share these concepts in an Amazon best-seller**: “Buy and Hedge, The Five Iron Rules for Investing Over the Long Term”. Next came the regular appearances on Fox Business News, Bloomberg, Forbes, etc. to share still more.
It became apparent that while we could explain the complexity behind our investment strategies, the execution still required expertise and, possibly more importantly, time. So we created ZEGA.
Today, we continue to share—beyond the Morningstar Separate Account Report—by providing the why and how behind our strategies’ performance in our weekly updates, blog posts, and white papers.
- We complement, not change, your approach.
You’ve already invested time and effort into building a client-specific portfolio strategy. You don’t need to change that to add our profit-protecting and income-driving methodologies.
Derivatives’ long history as a tool of conservative investors makes this possible. Plus, they truly blend well with our long-term investment horizon.
Finally, we follow the strictest of ethical codes to act only in the best interest of our clients. While this can come across as “yada, yada, yada”, we feel it is important to say. You’ll find: “We like to say what we’re gonna do.”
* Source: CBOE
** Amazon Best Seller in the Investing Category in the Month Launched - October 2011