A truly global multi-asset income solution
Source: Bloomberg, correlation coefficient is calculated based on weekly performance from December 2006 to December 2021.
Correlation ranges from +1 (perfect positive correlation) to -1 (perfect negative correlation). Relatively low correlation refers to correlation coefficients equal to or smaller than 0.5, moderate correlation between 0.5 and 0.75 (inclusive), and relatively high correlation above 0.75. Representative indices of each asset classes: Global REITs measured by FTSE Nareit Global REIT Index, Preferred securities measured by ICE BofAmL Fixed Rate Preferred Securities Index, Equity option strategies measured by 50% CBOE S&P 500 BuyWrite Index and 50% CBOE S&P 500 PutWrite Index, IG corp bond measured by BBgBarc Global Agg Corp Bond Index, HY corp bond measured by BBgBarc Global High Yield Corp Index, EM bond measured by J.P. Morgan EMBI Index, Global equities measured by MSCI AC World Index.
Based on historical data, while equities generally provide higher returns over time, they have higher volatility than bonds. Investors can use equity option strategies to potentially gain high yields through premiums while managing the risk in equities and also reduce volatility in their investments. This strategy is helpful in seeking a downside buffer during periods of market stress.
Source: Bloomberg, Morningstar.
Equity option strategies refer to 50% CBOE S&P 500 BuyWrite Index and 50% CBOE S&P 500 PutWrite Index. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment.