Keep pulling the thread on Cliff Asness.
The Morningstar category for options-trading-related funds has grown to over $230 billion in assets.
According to analysis by AQR Capital Management, the vast majority of buffered funds have underperformed a simple mix of an index fund and cash, while also experiencing larger drawdowns.
AQR Capital Management's analysis of equity-hedged funds with at least five years of performance found that the majority failed to deliver better returns or smaller drawdowns than a simple portfolio of cash and stocks.
The market for hedged equity funds tracked by Morningstar has grown to $60 billion in assets.
The market for hedged equity funds tracked by Morningstar has doubled from approximately $30 billion a few years ago.
Cliff Asness believes single-day options are an unnecessary financial product that primarily benefits the brokers who sell them.
AQR Capital Management formally recommends against investing in buffered funds.
Over the recent past, U.S. large-cap equities have significantly outperformed both bonds and international equities.
A significant portion of the U.S. stock market's recent outperformance is attributed to multiple expansion, which has caused U.S. equities to shift from being cheaper to more expensive than global markets.
Cliff Asness believes it is naive to expect the U.S. stock market to repeat its historical outperformance, as it is now starting from a more expensive valuation relative to global markets.
Cliff Asness asserts that the average user of single-day options loses money, similar to the average player on the gambling platform FanDuel.
The Robinhood trading platform now allows users to place sports bets, merging stock and crypto trading with sports gambling.