Total Return Strategies
Buy-Write Strategies
In addition to its proprietary options-based investment programs, Rampart offers passive options strategies. These strategies are based on the concept of a benchmark index similar to investing in the Dow Jones Industrial Average (DJIA), Standard & Poor’s 500 (S&P 500) or Europe, Australasia and the Far East (EAFE) indices.
Investors seeking a rules-based rather than an active options approach are best served using passive or indexed strategies. Rather than depending on a particular manager’s skill set, these strategies follow portfolio construction and investment procedures through time to derive their risks and returns. The BXM ascribes to that philosophy.
The long term benefits of these benchmark indices are equity-like (S&P 500) performance with significant reduction of the risk of equities, as defined by standard deviation. And while no strategy is optimal in all environments, these strategies tend to outperform the S&P 500 in down, flat and moderately up markets while underperform in strong, advancing markets. Because of their unique attributes, the BXM have been positioned by some as a separate asset class, while others retain it in the equity allocation category as an enhanced-index component.
The Benchmark Strategies provide investors with a disciplined and systematic approach to take advantage of an investment that historically has generated equity like returns with lower risk as defined by standard deviation. To participate in these strategies, investors should expect to have lower volatility than being in an equity long-only investment. That means underperforming in strong up markets and outperforming in most others. From time to time, paths that the market can take may cause these metrics to differ from expectations, both positively and negatively.
Benchmark Strategies Factsheet