Market conditions remained highly volatile during the reporting period, with geopolitical developments involving Iran contributing to significant moves in oil prices and investor sentiment.
One of the primary risks to the current options-based strategies is rapid market reversals rather than sustained price movement in a single direction. During the week, the oil market experienced a sharp upward move followed by an approximate 14% reversal over a short period. These developments contributed to larger-than-usual month-to-date fluctuations across several strategies and accounts.
Current portfolio positioning has been adjusted to reflect prevailing market conditions, with many positions rolled into later expirations over the coming weeks. Future results will depend on market movements and the evolution of market conditions.
MTD: -6.8%
YTD: +4.4% (before management fees and incentive fees)
The Low Volatility Fund experienced larger-than-typical month-to-date fluctuations during the reporting period, primarily reflecting the rapid reversal in oil prices.
Current positions have been adjusted and rolled into later expirations as part of ongoing portfolio management.
MTD: -5.3%
YTD: +18.7% (before management fees and incentive fees)
Low Volatility Fund II remained positive year-to-date despite recent market volatility.
Current positioning has been adjusted to reflect prevailing market conditions.
MTD: -7.0%
YTD: +10.75% (before management fees and incentive fees)
The Synthetic Protection Fund experienced month-to-date declines during the reporting period as oil prices reversed sharply.
For the hedge funds, reported returns may also be affected by incentive fee accounting during drawdowns. As previously accrued incentive fees are reduced, reported declines may be partially offset by this accounting treatment. This reflects accounting methodology rather than investment performance.
Current positions have been rolled into later expirations to reflect current market conditions.
MTD: -10.0%
YTD: +21.5% (before management fees and incentive fees)
The Volatility Advantage Fund experienced increased month-to-date volatility as market conditions changed rapidly.
Current positioning has been adjusted through rolling option positions into later expirations, with ongoing management based on prevailing market conditions.
MTD: Approximately -1.0%
The Insiders Fund is approximately down 1% month-to-date following a period of elevated market volatility.
No additional portfolio updates were provided during this week's market update.
Recent trading activity centered on managing oil-related option positions through a period of unusually rapid price changes. As oil prices moved higher, positions that had been expected to expire out of the money moved into the money overnight, prompting adjustments to existing option structures. Following subsequent developments related to U.S. policy and the conflict involving Iran, oil prices reversed sharply, leading to additional portfolio adjustments.
Outside of the repositioning period, day-to-day account fluctuations generally remained more limited. During today's approximately 9% move in oil prices, most accounts fluctuated by approximately 0.25% to 0.50%. Current positioning continues to include option exposure on both sides of the market, which may help offset gains and losses as positions are adjusted over time. However, rapid price movements that occur while markets are closed may reduce the ability to reposition immediately and may contribute to larger short-term account value fluctuations.
The views expressed herein reflect current market commentary and portfolio observations as of the date published and are subject to change without notice. Statements made by portfolio managers represent current opinions based on prevailing market conditions and should not be interpreted as guarantees, forecasts, or assurances of future performance or market direction.
Any performance information shown is preliminary, unaudited, and may reflect results before applicable fees, expenses, or final administrator reporting where noted. Actual investor results may differ based on fee structure, timing of contributions or withdrawals, and other account-specific factors.
This material is provided for informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any security, fund, or investment strategy. Past performance is not indicative of future results. All investments involve risk, including possible loss of principal.
