440 PREMIUM INCOME

440 Premium Income Overview

440 Premium Income is an absolute return overlay strategy that is designed to provide investors with income that is uncorrelated to the performance of their underlying investments held as collateral. The strategy uses the available margin on a portfolio to sell deep out-of-the-money call and put spreads on the S&P 500 index. The strategy’s objective is to obtain a positive return in all market environments, while minimizing the overall standard deviation of the strategy. Daily liquidity is available for subscriptions and redemptions with no lockup.

  • Absolute return overlay
  • Historically uncorrelated to high quality fixed income and low correlation to equities
  • Tax advantaged return

440 Premium Income Monthly Performance, Net of Fees (%)

Growth of $1,000

 

 

Strategy Details

SubscriptionsDaily
Liquidity – RedemptionsDaily
Management Fee1%
Performance FeeNone
Inception Date11/01/2008
Tax Treatment60% Long-term
40% Short-term

 Correlation Matrix

 (10/31/08 - 9/30/17)(1)(2)(3)(4)
Premium Income (net)1.00   
Barclays Capital U.S. Aggregate-0.031.00  
S&P National AMT-Free Muni Bond Index0.010.581.00 
S&P 5000.16-0.10-0.091.00

Performance Statistics (Net of Fees)

(10/31/08-9/30/17)

Annualized Return3.80%
Annualized Standard Deviation4.18%
Annualized Sharpe Ratio (0%)0.87
Annualized Sortino Ratio (0%)1.10
Downside Deviation3.44%
Month Average Gain0.62%
Month Average Loss-1.38%
3 Year Standard Deviation4.04%

Statistical Highlights

(ending 9/30/2017)

August 20170.34%
3 Month0.94%
YTD1.72%
1 Year2.35%
3 Year1.51%
5 Year2.18%
7 Year2.10%
Annualized Since Inception3.80%
440 Investment Group Disclosures
Past performance is not indicative of future results. There is no guarantee that the strategy will meet its investment objectives. This report should be used for informational purposes only and should not be deemed an offer to invest in the strategy.
The S&P 500 is a market-value weighted index provided by Standard & Poor’s comprised of 500 stocks chosen for market size and industry group representation. Individuals cannot invest directly in any index.
Option trading involves a significant degree of risk, which each prospective investor should seriously consider. The risk of loss in trading options can be substantial. Prospective investors should carefully consider whether such trading is suitable for them in light of their financial condition and individual risk tolerances. The high degree of leverage that is often obtainable in options trading can work against investors as well as for them. The use of leverage can lead to large losses as well as gains.
A full schedule of fees for all 440 products and their descriptions is available upon request. All returns are presented net of model management fees. The collection of fees has a compounding effect on the total rate of return net of management fees. 440 charges a .25% management fee for all clients on a quarterly basis, or 1% annually. Net of fee performance returns are presented after all fees, which include model management fees and actual trading expenses, including regulatory fees. i
Please see factsheets for full disclosures.

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