What is the Buy Write Monthly Index?

Discussion in 'Options' started by dgabriel, Jan 26, 2003.

  1. And how do you interpret it?
  2. Babak


  3. It is the CBOE's S&P 500 Index Synthetic Short Put Index, more or less...
  4. dis


  5. Well, 20% of 15% is 3% overall, not accounting for inflation. Also, the S&P was down, so, you would only be less negative, depending upon from where you measure. Not exactly burning up the market...

    P.S. You linked to the 3-mth chart.
  6. dis


    If earning 3% on other people's money by executing one or two transactions a month is not enough, one could double this by writing straddles... :cool: How many money managers have consistently beaten SP500 by 30%/year over the past decade?
  7. maglia rosa

    maglia rosa Guest

    When comparing the returns of a stock portfolio with the returns or a stock-and-options portfolio, you should probably not look at the absolute returns, but the risk-adjusted returns. Obviously with derivatives or leverage involved, you'd expect a higher return, but how much higher is the question.
  8. dis


    No leverage is involved here. In fact, a new "buy-write" position is only half as volatile (read: leveraged) as a "buy-and-hold" one.