What option and strategy would you use as the portfolio

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A Discussion on Options Strategies

The Situation

You are a portfolio manager and you manage several fund that make extensive use of options in combination with equities. The portfolios have different investor objectives and are subject to various constraints and expectations. Your job is to utilize the appropriate strategies to achieve these stated goals. Use the appropriate types of options and combinations to achieve your target return while staying true to the risk parameters of each portfolio.

Aggressive Return Mutual Fund

The Aggressive Return Mutual Fund seeks capital gains by investing in higher risk assets. Typical investors in this fund are young people at the start of their professional careers who seek to maximize their returns. These investors have a high risk tolerance and can bear to have temporary losses. Their investing time horizon is significantly longer than the average investor. Assets in this fund are 50% in shares of smaller companies that experience higher levels of volatility.

What option and strategy would you use as the portfolio manager?

Reference no: EM132815955

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