Customer Reviews

Enhanced Indexing Strategies: Utilizing Futures and Options to Achieve Higher Performance (Wiley Trading)

5 star:		(5)
4 star:		(1)
3 star:		(2)
2 star:		(1)
1 star:		(0)

 

 

The topic of the book (how to lever an index) was exactly what I was looking for, but despite being released in 2009, the book fails to even mention anything that has transpired over the last 2 years. All of the data ends in 2007, and the author routinely points out things like a 30% decline in the index is very rare. I understand this was probably written several years ago, but it's strange that every strategy he proposes (including his risk management techniques) would have resulted in catastrophic failure (losses >=100%) over the last 24 months. The author also relies heavily on backtesting and seems to lack a good grasp of fundamental investment concepts.

I came across Tristan Yates' writing and research from the website Seeking Alpha. Interested in his careful and clear explanation of why leveraged index ETFs don't deliver their expected 2x returns over time, I visited his website to read more of his work. There I discovered he'd recently published a book looking at well, enhanced indexing strategies and also using options--especially LEAPs--for better returns. I've always suspected there were "structural" opportunities with LEAPs, but don't have the knowledge to estimate returns. So I was eager to get a copy of Yates' book.

Although Enhanced Indexing Strategies isn't exactly what I expected, it is a very helpful resource. Yates is meticulous in his research and stats, showing how various combinations of options and alternative approaches to index investing will perform in a variety of conditions. I shudder to imagine the amount of number-crunching hours that went into the calculations. Yates answers questions like a) what kind of returns can one expect if they put the bulk of their assets in treasuries and buy LEAPs with the balance b)What option writing and buying strategies look the most promising-not just at this moment, but over the course of years and different market conditions. And c) how to use leverage in an index portfolio for maximum benefit. It easy to follow, as Yates is a clear writer. Still, this is not a book for beginners. I'd say intermediate to advanced. Happily, there isn't any intimidating math.

So what I was expecting? I was thinking the book would be a bit more definitive in telling you what to do. In retrospect this was naive as Yates can only lay out how strategies have performed, not tell you which ones to choose, given that depends on your risk profile and tolerance. Overall definitely recommended [if I had more control would give it 4.5 stars], as Yates looks and carefully quantities investing ideas few publish about in detail.

Practically all options books focus on in and out tactical trading; the type of trades that require you to stare at charts all day and not have a life. This book is really a handbook for institutional money managers and hedge fund managers. But its very relavent to the smart individual investor who wants to maximize portfolio returns with low levels of risk, and MOST importantly, to do so in least amount of time. Learn how they manage portfolios, hedge against downside risk, and generate cashflow thru theta (time) decay. The author provides a comprehensive review on how to hedge against the use of 5x-20x leverage to generate market beating returns with lower risk.

One gaines the most benefit by reading the books twice to absorb the details. Numerous "Investing" options strategies includes, vertical spreads, calendars, diaganols, portfolio Delta management, and DITM (deep in the money puts and calls). A MUST READ for the "Passive Income" investor. There is no other book at the Planet that addresses how to use options as an "investing" vs a "screen stare", "trading" tool. I highly recommend this book as its the best investing book I've ever read, and I've read over 100.

I found Tristan Yates from his LEAP website ([...]) when I was researching ways to increase more leverage in my personal portfolio. Impressed with his work I bought this book soon after it came out.

Pros:

* His book is definitely not based on magic. He draws on decades of research in investing.

* Interesting introductory chapters that would also appeal to experienced investors. It doesn't just re-hash the benefits of ETF or index funds.

Reason I gave 4 stars:

* Soon after the book came out VIX went to the 80's. The volatility examples in the book needs to be updated.

* I would prefer if there's a javascript application on the website where I can enter my personal scenario to find out the best source of leverage. Depends on your marginal tax rate and the tax laws of your country you might want to do margin loans instead of LEAP options. (See my analysis here, [...]

All in all, I would recommend this book as a great overview of leveraged indexing. Yates isn't try to show you how to get-rich-quick, instead he shows a sensible way to allocate your capital more efficiently with leverage.

Yates put together a wonderful book with lots of research about a topic that many investors often foolishly overlook while seeking out "high gain" opportunities. By investing in indexes that are naturally less risky than individual stocks and sectors, investors are able to profit tremendously by applying leverage while minimizing their risk. The author sets out to lay down the groundwork for numerous strategies that take advantage of high risk-adjusted returns.

While Yates provides plenty of strategies that allow investors to profit from leverage in up markets, there are a few factors that are overlooked which make his strategies less practical for an individual investor and eventually make his book seem like a long and in depth case study. It is interesting to read and understand, but few investors other than high net worth, *extremely* risk tolerant investors could practically benefit from most of the strategies presented. The distinctions between the mildly risky and extremely risky strategies are lightly touched upon leaving a wrong impression for investors looking for high gains.

Overall it is an important book for traders and money managers that have a long time horizon and freedom to take more risks than basic index or fund investing.

Enhanced Indexing Strategies: Utilizing Futures and Options to Achieve Higher Performance (Wiley Trading)

The author takes a unique strategy with strong intuitive appeal -- indexes reliable produce strong returns in the long-term and can therefore be leveraged with relative safety -- and brings it out of the realm of intuition and into the real world of investing. By providing detailed historical analysis of various leveraging strategies and in-depth discussion of how market conditions will effect the strategies going forward, the book enables the reader to think for him or her self and develop personalized strategies based on book's fundamental insights. I highly recommend the book to anyone who finds the author's basic insights appealing and would like to move from theory to action.

The title of this book is misleading. I bought the book expecting to learn more about investing in indexes using futures and options. I was mainly interested in learning more about using futures. The reason the title is misleading is the book doesn't get into discussions on how to use futures. There are maybe four or five paragraphs throughout the book that mentions futures but no details on how to use them. The book is all about using options, not futures. Because of this I was very disappointed in the book.

This is a very well written, informative and easily understandable book. I ordered a number of books to learn more about investing in these challenging times. This book was by far the most useful. The title intimidated me a bit but I decided I would give it a try...and I am very glad I did. I would recommend this book to people of all investing levels. It is easy enough to understand for the beginner and has many advanced strategies that will also benefit someone with much more experience.

This is a great book that has allowed me to reduce my risk while increasing my leverage and potential for returns. The timing of the release of this book could not have been better...Clearly it is better to be more leveraged closer to the bottom of the market than the top. I no longer fear a margin call because I have implemented some of the books strategies to more safely increase leverage using quality underlying investments. Adding leverage to something safer for higher returns makes more sense to me than investing in something riskier. I now have a portfolio with my desired level of volatility and leverage without taking unnecessary (and uncompensated) risk. The book helps quantify the risks of too much leverage. The book also shows ways of combining options to get cost effective downside protection. The book also contains enough historical data to help you make informed investing decisions. Overall, I feel the book gives enough information to effectively use options, LEAPS, and futures for long term profits.

After reading the book I did some research to find more from the author, Tristan Yates. I could not find any other books but I did find a number of useful articles he has written on Seeking Alpha, Forbes, Kiplinger and many others that I cannot remember right now. The book has given him the ability to go more in depth than his articles and provide a number of intuitive and useful alternatives to conventional investing. I like that he contributes to the community on a regular basis and feel good about buying his book to help compensate him for all his efforts.

Tristan Yates takes the idea of using indexes to a new level. The basic idea is that indexes perform well over the long term and that there are many different strategies that can capture long term appreciation. The initial strategy is to use rolling leap calls on several indexes. From there he lists multiple types of spread strategies and details the pros and cons of each. I found this book very useful and informative but it is not for beginners. Everything was backed with solid research and analysis. I highly recommend this book.