Advisors Option 55: The Truth About Options Backtesting

In this episode, Mark is joined by co-hosts: Chris Hausman, Portfolio & Chief Technical Strategiest, Swan Global Investments Aash Vyas, Director of Portfolio Strategy and Overlays, Swan Global Investments Matt Amberson, Principal, Option Research & Technology Services. Tricks of the Trade: Looking at Options Backtesting What is it? Options vs. Stocks: Why is it so difficult to backtest options effectively? What are some common mistakes that are made when attempting to backtest options? Are some options strategies easier to backtest than others? How do you deal with assumptions when backtesting options? How can advisors use backtesting to test the efficacy of their options strategies? The Buzz: A recap of the 2017 OIC Conference. Cerulli study says financial advisors who currently use options expect to increase use of options by 30% in three years. Office Hours: Options Question of the week This volatility implosion is starting to make people nervous. It's VIX limbo time: How Low Can It Go in 2017? Currently: 38% - 9.0 is the Bottom 18% - No lower than 8.5 15% - Cannot get below 8.0 29% - Listener Questions: Question from Aidan Chance - I heard you guys discussing the problem of lumping options funds and strats into the alts ghetto on the last show. I understand your complaints. What do you think would be a better category to gauge options performance? Question from Steve - With the VIX so low, I am not selling a lot of options anymore, because I'm afraid that I will not collect enough premium. Am I thinking of this incorrectly?