With over 35 years of experience in the industry, IPS works with advisors to understand their goals and risk tolerances and develop hedging strategies to address their specific needs. As there is no one-size-fits-all strategy to help clients and advisors manage risk and grow wealth while protecting against the downside, IPS offers complimentary portfolio consulting. With IPS’ expertise in the use of options to protect wealth, we can help you and your clients find optimal solutions.
Portfolio Manager, IPSAX
OIC Advisor Leadership Council
Adjunct Professor, University of Denver
& University of Colorado
Patrick leads the trading team and is responsible for executing all equity and derivative transactions by utilizing his in-depth knowledge and understanding of options.
Mahdi utilizes his knowledge of quantitative analysis, finance, and coding to perform in-depth back-tests and detailed regression analyzes for the firm.
When conducting portfolio reviews, Dominick is assisted by an impressive team led by Head Trader Patrick Hennessy and Quant Analyst Mahdi Mahjoub. Patrick, who is a Chartered Market Technician, heads the IPS trading team and utilizes his deep understanding of both options and financial markets in analyzing and mitigating risk. Mahdi, who has a Master of Finance and a B.S. in Mechanical Engineering, supports Dominick and Pat’s work by performing detailed regression analyses of various hedging strategies applied to specific portfolios.
Please contact us if you would like us to conduct a complimentary risk analysis of your portfolio
and make preliminary recommendations of how we can add optionality to reduce your risk.
IPS Defined Outcome Investments are innovative investment products which allow clients to achieve significant exposure to an asset class while mitigating much of the downside risk associated with that exposure. By using only exchange traded products we are able to ensure liquidity and flexibility in these short-term vehicles, which can be customized for specific goals and risk profiles. Low cost and historically extremely reliable, Defined Outcome Investments are powerful options for reducing and defining risk while adding excellent diversification to a portfolio.
The IPS Bear Strategy is designed as an overlay on top of a portfolio which, based on detailed regression analysis, has shown to deliver a downside Beta of -1.74 and an upside Beta of -0.30. This means that on average, when the market is down -10%, the overlay will be up +17%, and when the market is up 10%, the strategy will be down -3%.
This rules-based overlay is designed to deliver structural alpha when added to a portfolio framework.
With the average 1 year CD paying less than one percent and bonds paying zero, how can interest be generated in a very conservative strategy that provides liquidity? Using dividends as an income generator has been a tried and true way to grow wealth since the turn of the 20th century.
The IPS Income Strategies use this concept of owning dividends with IPS Strategic Capital’s expertise in hedging market volatility.
If you can own a basket of dividend stocks, which would eliminate the risk of anyone company cutting their dividend and at the same own downside protection on the portfolio at no cost, that would give you a defined income without the worry of a market crash.
The search for a dependable, low-cost portfolio tail protection or hedge from exogenous events such as the 1987 crash, 2008 credit crisis, 2011 European crisis, and the Covid-19 crisis is imperative in an environment where zero interest rate environments make bonds ineffective as a hedge.
The IPS Volatility Hedge is designed to define the cost of a hedge and has proven to be extremely effective in market crashes. The graph below shows how a de minimus allocation to the IPS Volatility Hedge in a 100% long portfolio would have resulted in a total portfolio value return of over 14% at the March 2020 bottom.
The information on this website should not be misconstrued as an offer to buy or sell, or a solicitation to buy or sell securities. Any historical, non-hypothetical performance contained within this website is representative of net-of-fees performance. 2011 ARS performance represents a non-fee paying account and 2011 returns are gross of fees. The past performance of any investment(s) does not necessarily indicate the future performance of any investment(s). No client, current or prospective, should assume the future performance of their investments will be profitable based on historical performance. Any backtest charts and data presented are purely hypothetical and do not represent the performance of accounts managed by IPS Strategic Capital. The results were obtained by applying a rules-based investment process to historical data. Hypothetical performance is not indicative of the performance of investment returns in the future. The results shown here are strictly for informational and educational purposes. All investments have the potential for profit and the potential risk of loss. Changes in investment strategies, contributions, or withdrawals may cause the performance results of one’s portfolio to differ materially from the reported composite performance. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will either be suitable or profitable for a client’s portfolio. One should always consult an investment advisor before making any investment decisions.