3. AdvisorShares STAR Global Buy-Write ETF (NYSE:VEGA)
AdvisorShares STAR Global Buy-Write ETF (NYSE:VEGA) is a low volatility global balanced portfolio that strategically allocates to the capital markets, writing covered call options against a part of its underlying securities, resulting in an option premium. This additional income, in addition to bond interest and equity dividends from the portfolio can hedge against downside risk.
A prominent holding of AdvisorShares STAR Global Buy-Write ETF (NYSE:VEGA) is SPDR S&P 500 ETF TRUST, which seeks to provide investment results that correspond to the price and yield performance of the S&P 500 Index. A significant underlying security of SPDR S&P 500 ETF TRUST is JPMorgan Chase & Co. (NYSE:JPM), a New York-based multinational investment bank and financial services holding company.
On December 14, JPMorgan Chase & Co. (NYSE:JPM) reported a $1.00 per share quarterly dividend, in line with previous. The dividend was paid on January 31. JPMorgan Chase & Co. (NYSE:JPM) shares deliver a dividend yield of 2.98% as of March 7.
Among the funds tracked by Insider Monkey, Fisher Asset Management held the largest stake in JPMorgan Chase & Co. (NYSE:JPM) as of the end of 2021, with 7.4 million shares worth $1.17 billion. Overall, 107 hedge funds were bullish on JPMorgan Chase & Co. (NYSE:JPM) in the fourth quarter of 2021.
Here is what Miller Value Partners Opportunity Equity had to say about JPMorgan Chase & Co. (NYSE:JPM) in its Q4 2021 investor letter:
“I remember writing about the attractiveness of JP Morgan (JPM) right before it lost about a third of its value in the third quarter of 2011 (which didn’t please some of my colleagues!). I believed JPM was a high-quality bank whose prospects were undervalued due to the overhang on the space. It made money every year through the financial crisis.
In the decade-plus since then, JPM has beaten the market nicely (+417% versus SPX +345%) despite significant headwinds for banks (S&P Financial Sector +286%) and value stocks. Low market expectations are a key ingredient to attractive long-term returns!
An earthquake after-shock metaphor helps to explain the situation. Earthquakes relieve tension in physical systems, but aftershocks are common. These aftershocks aren’t as serious as the original event because stresses have been relieved. The financial crisis alleviated tensions in the financial system as weaker players either perished or were shored up with capital. Lessons learned impacted behavior (lower risk-taking behavior and higher propensity for monetary authorities to intervene supportively), which reduced future risk.
Those realities didn’t matter in the short term, but they sure did in the long term.”
