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Articles Posted in Yield Enhancement

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 Crash of the Condor: “Iron Condor” S&P Option Trading Strategy Marketed as Providing “Yield Enhancement” for Bond Investors Delivers Losses

An options trading program marketed as a “Yield Enhancement” strategy to brokerage customers of UBS, reportedly including risk averse investors with substantial bond portfolios, has suffered a hard landing in November and December as the so-called “Iron Condor” index options spread-based scheme has reportedly delivered losses in excess of 20%…

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“Yield Enhancement” Options Strategies, Including UBS “Iron Condors” Program, May Cause Outsized Losses

In response to the low interest rate environment that has prevailed for a decade, many brokerage firms — including well-known wirehouses such as Merrill Lynch, Morgan Stanley, and UBS — have reportedly recommended various options strategies to their customers as supposedly safe and efficient mechanisms to enhance income.  However, when…

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