The week ending December 11, 2015 witnessed the return of volatility on Wall Street with the S&P 500 ending its worst week since August with concern about declining commodity prices and the first U.S. interest rate hike in nearly a decade.
In our last post, we reviewed thoughts on making money in a sideways moving market. Specifically, we recommended seeking active management strategies in the portfolio.
Two hedged equity strategies that our investment committee is using are ABS Investment Management and the Glenmede Secured Options fund. Both managers are examples of active strategies that can add return while taking less risk in a market environment that is moving sideways.
ABS Investment Management
ABS Investment Management is an active manager focusing on building a portfolio of equity long/short hedge funds. The focus is on finding mid-sized managers across the globe.
Source: ABS Investment Management through 11/30/2015
As you can see, ABS has delivered significant over performance versus their peer group and the broad market year-to-date and over the past 12 months.
Glenmede Secured Options fund
The Glenmede Secured Options fund seeks to outperform the market over time by generating current income and capital appreciation with reasonable risk to principal. The strategy uses covered calls and secured puts in an attempt to generate premium income while seeking to mitigate downside risk.
Source: Glenmede through 11/30/2015
Similar to ABS, Glenmede has delivered significant over performance versus their peer group and the broad market, most notably year-to-date and over the past 12 months.
Our investment committee will continue to remain diligent and seek opportunities and managers that can add performance while taking less risk given the current market conditions.
Securities are offered through HighTower Securities, LLC, member FINRA/SIPC/MSRB. HighTower Advisors, LLC is a SEC registered investment adviser.