Who might need income?

Accumulators

Income doesn't have to be spent. Use the cash generated from the strategy to reinvest in growth assets such as shares or listed property.

Retirees

Retirees may find themselves selling down equity in their portfolio if dividends are not sufficient to fund their retirement. Generating additional income can replace some or all of this shortfall.

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A layer of enhancement

Use your portfolio to generate additional income

Our income strategies are best conceptualized as another layer over your portfolio. The income generated is in addition to dividends, and is typically extracted by selling S&P/ASX200 index options or individual equity options.

By limiting the upside gains of a portfolio by selling calls or committing to buy new shares when they appear cheap by selling puts, we are able to extract regular payments from the market when conditions are favourable.

The first step is choosing your underlying portfolio.

Choose a portfolio

Choose your underlying portfolio

Personal Advice

Tailored for your unique circumstances

Use our full service advisory process to create a tailored portfolio specific to your needs and investment goals. The process will begin with an in depth fact finding meeting with your adviser and end with a detailed proposal.

Model Portfolio

Pre-made and ready to customise

Use one of our model portfolios as either a pre-made solution or a baseline to customise to match your view. You can work with an adviser through this process to find a solution that makes sense to you.

Bring Your Own

Easy and free to transfer over

If you are an experienced investor and have an existing selection of stocks that you are happy with, we can use that as our underlying portfolio and simply add the Income Strategy over the top.

How does it work?

The strategy itself is quite simple. When the market appears expensive and is high in its range, we take a view (using S&P/ASX200 index options) that we are happy to cap our portfolio gains at a certain distance from today's price. When the market appears cheap, we do the opposite and take a view that we are happy to add to our portfolio and buy the market at a certain distance below today's price. We are paid a small premium each time we take a view and this becomes our income.

  • Our Science

    Over a decade of refinement has led to development of statistical probability models allowing us to identify ideal opportunities.

  • Why Index Options?

    Given most clients hold a stock portfolio containing ASX 200 shares, index options are a cheaper alternative to multiple trades in individual equity options.

  • Frequency

    The ideal time frame is around 2 months, however often opportunities arise anywhere between 1 and 3 months.

  • Implementation

    An adviser will be able to handle the process from identifying opportunities, implementation and ongoing management.

  • Risk

    Everything comes at a price; the strategies can either increase or decrease risk on the portfolio, depending on its structure.

The science of selling options
Selling put options for income

You don't need to change anything you are doing to try it out.

Speak with an adviser to discuss how to layer the strategy over your existing portfolio.

Contact Us Find An Adviser

Why use us for your strategy advice?

Costs Netted Off

When you enter an income trade, you are paid a cash credit to open the position. This allows you to simply net off transaction costs from the income received.

Maintain Current Portfolio

Getting started is simple and unobtrusive with the ability to simply start implementing the strategy over your current portfolio.

Professional Advice

Take comfort in the fact that your adviser is a qualified to the highest level with every one of our options advisers required to pass the Accredited Derivatives Adviser Level 2 certification.

Conservative or Aggressive

The strategy can be used as conservatively or aggressively as you like. The strategy remains the same, all the changes is the size of your position relative to your portfolio.

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I already get dividends from my portfolio, how is this different?

If you hold direct shares, chances are you already produce an income via dividends. Our strategies are quite different to dividend income as they use the options market as a way to generate cash premium in exchange for taking a view on future market movements and do typically add risk to a portfolio.

Frequency

The strategies allow an investor to generate income on a more frequent basis than bi-annual dividends.

Control

Each investor has the ability to scale the strategy to scale the strategy to generate different amounts of income based on their view.

Implementation

Whereas dividends are deposited automatically to your nominated bank account, your adviser will call you to discuss each opportunity individually.

Risk

Everything comes at a price; the strategies generally increase risk on the portfolio, but only to a level each investor is comfortable with.

What are the risks?

Market Risk

We use options to hedge market risk of your share portfolio. Note that the Options may fall in value or become worthless. Changes in the underlying share price may change the Option price, but the option price change may be in a different direction or magnitude.

Time decay

Options have an expiry date and therefore a limited life. An Option's time value erodes over its life and this accelerates as an Option nears expiry which can be beneficial or negative depending on the strategy.

Leverage

Leverage can lead to large losses as well as large gains. When investing in options, your initial outlay is small relative to the total contract exposure, a small market movement may have a larger impact on its value.

Option writers may face losses

Selling Options involves risk. If you sell and the position moves against you, you may lose more than any premium received. Where the position is naked, losses are potentially unlimited.

Calls for additional capital

If the market moves against you or margins increase you may have to provide additional funds at short notice. If you do not, your position may be closed and you will be liable for any resulting loss.

Speak to an adviser about how to start generating income using your portfolio today.