Do buy-write strategies work on Australian equities?

A “covered call” or “buy write” strategy involves selling call options against an investor’s share portfolio to gain extra income. By selling a call, investors earn income in exchange for giving up the right to some upside share price appreciation, if the share prices rise beyond a certain level (these are called ‘premiums’). So does a buy-write strategy over an Australian equities portfolio generate better results? According to recent research, compared to a traditional “buy and hold” strategy, a “buy write” strategy over Australian equities has the potential to provide enhanced income as well as attractive risk-adjusted returns by reducing overall volatility of total returns. For more click the link: (VIEW LINK)


David Bassanese
Chief Economist
Betashares

Author, columnist, investment strategist and macro-economist. Previous roles at Federal Treasury, OECD, Macquarie Bank and AFR. I develop economic insights and portfolio construction strategies for BetaShares' retail and adviser clients.

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.

Comments

Sign In or Join Free to comment