Buy & Hedge Investments

Performance

Buy & Hedge Retirement

as of 03/31/2024	MTD	YTD	1 Year	3 Year	5 Year	10 Year	ITD
Buy & Hedge Net*	2.90%	6.76%	16.70%	2.13%	7.78%	6.28%	7.72%
Bench (S&P 500)	3.22%	10.56%	29.87%	11.50%	15.06%	12.97%

Buy & Hedge Classic

as of  03/31/2024	MTD	YTD	1 Year	3 Year	5 Year	10 Year	ITD
Buy & Hedge – Net*	2.60%	8.15%	21.14%	6.41%	9.57%	7.52%	8.05%
Bench (S&P 500)	3.22%	10.56%	29.87%	11.50%	15.06%	12.97%

*Note: Returns are expressed in US Dollars net of fees.

ZEGA Financial is a SEC registered investment adviser and investment manager that specializes in derivatives. ZEGA is a separate accounts manager and all returns expressed herein are solely from the separate accounts business within ZEGA.

The Buy & Hedge Retirement strategy utilizes index-based options and ETFs. Purchases Index call options to synthetically create long market exposure. The underlying index is U.S. large cap and typically one that represents the S&P 500. The investor has long-term market exposure in the equity markets but attempts to reduce downside risk by limiting the actual capital invested in equity positions. The position is created using a combination of options to build synthetic exposure as well as creating an income portion designed to generate a low risk 3-4% of annual return. The income portion may be constructed using fixed income or protected equity with a defined risk. Buy & Hedge accounts are designed to limit downside exposure with a targeted cost of hedging ranging from 1 to 3% per year. While this may cause underperformance in up years, the protection is meant to help avoid losses during market corrections. All portfolios that are at least 70% allocated to this strategy are included.  

The Buy & Hedge Classic strategy is designed to provide broad market exposure while limiting the downside risk in the event of a material market correction. The product utilizes index-based options and ETFs by purchasing S&P 500 ETFs with ~95% of the portfolio value. The downside put options are set at 10% out-of-the-money. The investor has long-term market exposure in an S&P 500 ETF that has been paired with a hedge that has a negative correlation to the market. The hedge is built using a combination of option positions. This strategy targets a high correlation to the S&P 500. The strategy looks to minimize the cost of hedging by possibly selling options premium on both out-of-the money calls and puts.  This composite includes all portfolios that were at least 70% dedicated to this strategy.

The benchmark is the S&P 500. The S&P 500 Index is a collection of 500 of the largest publicly traded US Equity large cap companies. The secondary benchmark is the Barclays US Aggregate Bond Index. This Barclays Index is a market cap weighted index of fixed income securities and it widely considered the most used index in the fixed income investment community.

ZEGA Financial claims compliance with the Global Investment Performance Standards (GIPS). To receive a full list of composite descriptions of ZEGA Financial and/or a presentation contact Jay Pestrichelli at 1-800-380-9342, ext 101 or jay.pestrichelli@zegafinancial.com.

All investments involve the risk of potential investment losses as well as the potential for investment gains. Prior performance is no guarantee of future results and there can be no assurance, and clients should not assume, that future performance of any of the model portfolios will be comparable to past performance.

These results should not be viewed as indicative of the advisor’s skill. The prior performance figures indicated herein represent portfolio performance for only a short time period, and may not be indicative of the returns or volatility each portfolio will generate over a long time period. The performance presented should also be viewed in the context of the broad market and general economic conditions prevailing during the periods covered by the performance information. The actual results for the comparable periods would also have varied from the presented results based upon the timing of contributions and withdrawals from individual client accounts. The performance figures contained herein should be viewed in the context of the various risk/return profiles and asset allocation methodologies utilized by the asset allocation strategists in developing their model portfolios, and should be accompanied or preceded by the model.

Standard deviation is a measure of the dispersion of a set of data from its mean. The more spread apart the data, the higher the deviation. In finance, standard deviation is applied to the annual rate of return of an investment to measure the investment's volatility.

The investment management fee schedule for the composite varies. Our wealth management fee for portfolio management services is 1.5%. These fees are negotiable depending upon the client’s financial situation and the client’s objectives. Our sub advisory fee for portfolio management services is 0.75%. These fees are negotiable depending upon the complexity and scope of the plan.

Certain portfolios may incur additional advisor directed fees. As a result, ZEGA’s returns for these accounts are net of the additional fees due to our subadvisor agreements.