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Products

ZUOM

ZEGA Ultra Opportunity Model

An Aggressive Growth Strategy

Looking for that strategy designed to outperform the stock market on the up years? You’re not alone. ZEGA has flexed our deep knowledge of options to build our own Ultra model. We call it ZUOM. ZEGA’s Ultra Opportunity Model is our most aggressive strategy that aims to deliver a multiple on market returns and is ideal for the individual looking for excess growth. Like all things investing, with greater reward comes greater risk, so any potential investor should be willing to accept the risk and volatility that comes with it. Most investors find ZUOM to be appropriate for their long-term allocation bucket where it can take advantage of the historical trends of rising stock markets.

The strategy utilizes index options and volatility harvesting techniques with the intent to deliver excess returns over the broad market.

An innovative approach to build an Ultra-Equity Model

ZUOM utilizes the implied leverage of options to deliver a multiple on returns without the inherent tracking error that drags other 2X and 3X strategies or ETFs.  It is an aggressive growth strategy that utilizes both synthetic stock replacement and premium selling tactics as means of growth.

For sophisticated and accredited investors looking for an aggressive allocation with a multi-year time horizon

Carries significantly higher volatility than a standard stock portfolio with opportunity for outsized growth.  Aims to generate Alpha.

Performance


ZUOM - ZEGA's Ultra Opportunity Model

as of 12/31/2020MTDYTD1 Year3 Year5 YearITD
ZUOM Net*7.14%108.22%108.22%--41.96%
Benchmark3.84%18.40%18.40%--


ZEGA’S ULTRA OPPORTUNITY MODEL (ZUOM) COMPOSITE includes all institutional, retail, and founder portfolios that deploy long-dated calls and call spreads with more than 150% notional market value subsidized by credit spread pairs tactic. This portion of the portfolio uses out of the money index credit spreads paired with debit spreads that have net returns of 1% to 3% per trade. The strategy aims to deliver risk-adjusted returns that are correlated to the broader markets. A rapidly declining market generally negatively affects the strategy’s positions. The DBOT strategy maximizes the amount of buying power available in a portfolio, and therefore takes on the maximum amount of risk and is recommended for the most aggressive investors. This composite includes all portfolios that were at least 70% dedicated to this strategy. The benchmark is the S&P 500. 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 minimum account size for this composite is sixty thousand dollars ($60,000). The ZEGA Ultra Opportunity Model was created January 1, 2018.  

ZEGA Financial, LLC (“ZEGA”) claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards.   ZEGA has been independently verified for the periods July 1, 2011 to December 31, 2019.  The verification report(s) is/are available upon request

Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm’s policies and procedures are designed to calculate and present performance in compliance with the GIPS standards.  Verification does not ensure the accuracy of any specific composite presentation.

ZEGA Financial is an independent registered investment adviser.  The firm began managing client assets in July 2011. Since July 2011, firm assets included any accounts for which ZEGA Financial has at least some discretionary authority which includes accounts in ZEGA’s wealth management practice and the investment management accounts for which ZEGA Financial was a sub-advisor to the account. The firm’s list of composite descriptions is available upon request.

Results are based on fully discretionary accounts under management, including those accounts no longer with the firm. To qualify as fully discretionary, at least 70% of the account must be dedicated to the composite strategy and no more than 20% of the account may be invested at discretion of a party other than ZEGA Financial. Derivatives and short positions make up a material part of the composite strategy which includes short selling, with the short position covered by cash accounts that are marked to market daily.  Past performance is not indicative of future results.  

The U.S. Dollar is the currency used to express performance.  Returns are presented gross and net of fees and include the reinvestment of all income.  This composite is a mix of accounts that are Wrap based and non-Wrap based (i.e., pay commissions). Gross returns are shown as supplemental information and are stated gross of all fees and transaction costs for wrap accounts, and net of transaction costs for non-wrap accounts. Net returns are reduced by all fees and transaction costs incurred. Wrap fee accounts pay a fee based on a percentage of assets under management.  Other than brokerage commissions, this fee includes investment management, portfolio monitoring, consulting services, and in some cases, custodial services. The weighted average percentage of assets that were in Wrap fees is available upon request. Wrap fee schedules are provided by independent wrap sponsors and are available upon request from the respective wrap sponsor.   Net of fee performance was calculated using actual management fees.  The annual composite dispersion presented is an asset-weighted standard deviation calculated for the accounts in the composite the entire year.  Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon request.

The investment management fee schedule for the composite varies. Our fee for portfolio management services is based on a percentage of assets ZEGA manages and ranges from 0.50% to 1.7%. The fee is negotiable depending upon the complexity and scope of the plan, your financial situation, and your objectives. Employee accounts do not pay advisory fees, so the returns illustrated for the strategy are higher than they would be if employee accounts paid similar fees.