SPX Overlay Strategy

S&P 500 Exposure + Tactical Alpha Generation

Target Tactical Alpha: % annually Target Total Return: SPX + 8%

Target Alpha

+8%

annually

Target Total Return

SPX + 8%

~18% in avg year

Avg SPX Drawdown

-14.1%

intra-year since 1980

Years with 10%+ Correction

64%

of all years

Strategy Performance: $100M Portfolio

Traditional passive investing vs. Overlay with tactical alpha

Market Scenario	SPX Return	Traditional	Overlay Strategy	Alpha Generated

5-Year Compounding: $100M Initial Investment

Assuming SPX averages 10% annually. Overlay targets SPX + 8%.

Traditional After 5 Years

$161M

+61% total return

Overlay After 5 Years

$229M

+129% total return

Incremental Value Created

+$68M

from tactical alpha

S&P 500: Annual Returns vs Intra-Year Drawdowns (1990-2024)

Even in years with strong positive returns, significant drawdowns occur. Tactical strategies can generate alpha through this volatility.

5-10% Drawdown

10-20% Correction

20%+ Bear Market

Drawdown Frequency: % of Years Experiencing Each Severity

Volatility is a feature, not a bug—creating consistent opportunities for tactical alpha generation.

The Opportunity

94% of years experience at least a 5% drawdown, and 64% see corrections of 10% or more. This consistent volatility creates opportunities for tactical strategies to generate alpha.

Our Approach

We use the capital efficiency of to maintain SPX exposure while deploying tactical strategies targeting additional annual return across volatility, exposure management, and cross-asset opportunities.

The Value Proposition

Why accept SPX returns alone when capital efficiency allows for more? The overlay maintains your full market exposure while our tactical strategies target additional alpha—potentially turning a 10% market return into an 18% portfolio return.

100%

SPX Exposure Maintained

+8%

Target Tactical Alpha

+$68M

5-Year Value Add*

129%

5-Year Target Return*

*Assumes 10% avg SPX return and target tactical alpha achieved consistently. Actual results will vary. Past performance is not indicative of future results.