We build Separately Managed Accounts
Tailor-made, OPTIONS-BASED strategies may not be quick or easy to create, but we feel our approach is crucial to helping clients reach their long-term objectives.
Separately Managed Accounts
The Connors Options-Based Strategies
The Connors Small Company Solutions
At Connors Investor Services we have been managing our strategies in the form of Separately Managed Accounts (SMAs) since 1974. Although managing each client’s account as a standalone is a much more time consuming process, as opposed to managing a mutual fund where investors pool their assets, we believe that the benefits of the SMA for the more affluent investor are too large to ignore. In our SMAs, every management decision in the account is made in your best interest because your investment is the only one we are focused on.
A covered call is an options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset in an attempt to generate increased income from the asset.
A protective put strategy is usually employed when an investor is still bullish on a stock, ETF or Index they may already own but wary of uncertainties in the near term. It is used as a means to protect unrealized gains on shares from a previous purchase.
This strategy is constructed by purchasing one put option while simultaneously selling another put option with a higher strike price. The goal of this strategy is realized when the price of the underlying stays above the higher strike price, which causes the short option to expire worthless, resulting in the investor keeping the premium.
The CBOE S&P 500 BuyWrite Index (ticker symbol BXM) is a benchmark index designed to show the hypothetical performance of a portfolio that engages in a buy-write strategy using S&P 500 index call options.
An index option is a financial derivative that gives the holder the right, but not the obligation, to buy or sell the value of an underlying index, such as the Standard and Poor’s (S&P) 500, at the stated exercise price on or before the expiration date of the option.
We look forward to building you a portfolio that is tailored, transparent and tax sensitive.
TAILORED
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- SMA owners can customize their holdings by excluding certain securities or industries. A client may, for example, wish to screen for tobacco or defense stocks or desire us to hedge their stock holdings with some protective puts. In the end, we try to manage a portfolio that is the best fit for the investor’s needs, not our own.
TRANSPARENT
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- Although mutual funds offer the masses an affordable mechanism for achieving portfolio diversification with management expertise, often the investor is not certain what they own or how fees are calculated. At any point with an SMA, you will know what shares you actually own and have a cost basis for each position. Also, your fee will be clearly defined and you will see all trades that take place.
TAX-SENSITIVE
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- SMA holders pay taxes only on the capital gains they actually realize. By contrast, investors who hold mutual funds in their taxable accounts get hit with taxable distributions for transactions made within the fund, even if they didn’t sell any shares – and even if the fund itself ended the year at a loss.
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