OVERVIEW & PROCESS

Equity Options Overlay Strategies

IRON’s depth of equity options expertise stems from our deep quantitative research skills, practical trading experience in the equities and options markets, and advanced research and portfolio management techniques.

Our approach is designed to deliver attractive risk-adjusted net returns relative to alternative sources of equity market exposure.

  • Options Enhanced S&P 500 Equity Strategy (S&P Equity Plus Strategy)
  • Options Enhanced Global Equity Strategy (Global Equity Plus Strategy)

IRON’S EQUITY PLUS STRATEGY

Investment Objective

The objective of IRON’s Global Equity Plus Strategy is to provide superior risk-adjusted total returns relative to the All Country World All-cap Equity Index by utilizing an actively managed options overlay strategy on the underlying exchange traded index funds.

Investment Philosophy

IRON’s investment philosophy stems from the belief that one can enhance the returns of a broad global market index by opportunistically writing and actively managing options on the underlying four exchange traded index funds. We believe most option overlay strategies do not fully utilize the driver of performance, the underlying securities, and therefore at times unnecessarily write options, thus capping the upside performance.

Investment Methodology

Selecting and Writing Options
Our proprietary model takes into account many factors including, but not limited to, the option premium, delta, tenor, and volatility (both implied and realized). With these inputs determined, the portfolio manager will decide which option, if any, should be written on the underlying four exchange traded funds. IRON has determined through its proprietary research that it may be more advantageous not to write options on the underlying positions to achieve its maximum upside potential during certain market cycles.

Roll Strategies
The strategy actively manages written call positions through the use of IRON’s proprietary roll strategies. During the course of a written option position, the portfolio manager will decide whether to let the option expire, close out the option when an optimal amount of premium can be realized or cover the option to realize upside appreciation of the underlying.

Risk Management
Our proprietary option overlay methodology seeks to limit option moneyness when the underlying trades above the strike price or the option trades “in the money”. The goal is to limit the price paid to close the option position and also allow the underlying to participate in capital appreciation to a greater extent, particularly in rising market conditions. By utilizing effective risk management practices, we believe we can enhance the risk-adjusted total return of the portfolio relative to its benchmark.

PORTFOLIO PERFORMANCE

as of 9/30/2017

PORTFOLIO PERFORMANCE SINCE INCEPTION

February 1, 2011 – September 30, 2017

*Since Inception February 1, 2011

** The FTSE Global All Cap Index is a free float market capitalization weighted index designed to provide a broad measure of equity market performance throughout the world. The FTSE Global All Cap indices include constituents of the Large, Mid and Small capitalization universe for the Developed and Emerging Markets (Advanced Emerging and Secondary Emerging) segments. As of June 30, 2016, the index’s asset allocation is approximately 56.7% in North America, 20.5% Europe, 13.9% Pacific, 8.7% Emerging Markets, and 0.2% Middle East. The total return index includes capital appreciation and dividends.

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RISK RETURN

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LITERATURE

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MANAGEMENT TEAM

 - AARON IZENSTARK

AARON IZENSTARK

CO-FOUNDER, CIO
MANAGING DIRECTOR

 - TED CONNOLLY

TED CONNOLLY

DIRECTOR, PORTFOLIO MANAGEMENT AND TRADING

 - JOE FANARO

JOE FANARO

PORTFOLIO MANAGEMENT AND TRADING

 - DR. RAMESH POOLA, PH.D., CFA

DR. RAMESH POOLA, PH.D., CFA

MANAGING DIRECTOR OF INVESTMENT AND QUANTITATIVE RESEARCH

Management fees of 0.70% annually, our highest published fee, have been deducted from the above results. The data for the IRON Equity Plus Strategies includes all discretionary portfolios in the composite. In order to be included in the composite, an account must have an initial starting balance of $250,000 or greater. Net returns reflect deduction of management fees on a monthly basis. Actual accounts are charged quarterly in arrears based on the quarter end value adjusted for capital flows. The advisor’s advisory fees are described in our ADV Part 2. Past performance is not indicative of future results and an investment in the IRON EQUITY Plus Strategies involves the risk of loss, particularly with respect to short-term performance. The data assumes reinvestment of dividends and interest and includes transaction costs. If dividends and interest were not reinvested, then the above results would be considerably different. Performance results for the above are unaudited.

Investment results shown above are based upon the particular securities selected. The charts, tables, performance and other information shown are provided to you for informational purposes only and are not intended to be and do not constitute investment or tax advice nor an opinion or recommendation regarding the appropriateness of any investment. The information is based upon the particular securities selected by IRON Financial, LLC on the date appearing in the materials. The material contained in this document is for general information purposes and is not intended as an offer or a solicitation for the purchase and/or sale of any security or financial instrument, nor is it advice or a recommendation to enter into any transaction. Future returns may differ significantly from the past due to materially different economic and market conditions. Investments within portfolios, and therefore, portfolios, involve risk and the possibility of loss, including a permanent loss of principal. Actual returns for individual client portfolios managed by Iron Financial, LLC may vary and do not necessarily coincide exactly with the returns for the performance group. Actual performance of client portfolios may differ materially due to the timing related to the actual deployment and investment of a client portfolio, the reinvestment of dividends, length of time various positions are held, client objectives and restrictions, and fees and expenses incurred by the individual portfolio. Past Performance is not indicative of future results.

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