Zigzagging Markets Are Frustrating for Passive Investors

Expected volatility remains elevated (short- and longer-term)

In this new bi-weekly video update (or discussion as we’d like to call it), we shed light on the favorable situation for options sellers, as short-term and longer-term implied/expected volatility stays fairly elevated. Meanwhile, the market seems to be zigzagging, and investors have grown increasingly cautious on small caps and lower-quality names.

As we stated last year, we believed 2025 was going to be much like 2018. Will 2026 be surprisingly strong? We don’t know, and frankly, we don’t care. The fact is that our strategy has been simplified by key principles we spent months researching in and prior to 2022.

Accounting for the remaining time value in short-term positions, the portfolio return should hit a new high next month.

Let’s discuss all of this and our portfolio positions in today’s video update. The transcript and slides can be downloaded below.