May 29, 2014

Advisors Option 19: Pension Problems and PUT Writes

1 hour 2 minutes

The Buzz: News out of China: OIC, Shanghai Stock Exchange content licensing agreement. Pensions seek bond diversification. Report: UK pensions miss out on returns. Chuck likes index funds. Retail investors not afraid of equity markets. Low VIX: what does it mean for volatility?

Listener Mail: Your comments and questions

Question from Neil Staffenberg: thank you for this program. It is very informative. I've heard you mention SMAs on this program in the past. I'm not familiar with this term. Can you explain what you are referring to and the significance it has for the advisor community.

Question from Avow: what do the hosts think of recent claims from advisor-centric firms like Charles Schwab that the market is rigged against individual investors? Should I be instructing my advisor to move me to cash? Is purchasing a put sufficient protection to my broad portfolio or are the options market rigged against me as well?

Question from Tim Nichols, Fredericksburg, VA: can you provide an overview of the CBOE put write index. The BXM has been discussed widely but I haven't come across much discussion or analysis on this sister product. From all the research I've encountered the product appears to perform quite well. It seems that structured products that include automation are the preferred tools for many financial advisors and planners. Would the panel recommend the put write index as a viable alternative for advisors looking to add options to their portfolio without the hassle of writing the options themselves?

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