RECORD HIGH WEEKLY CLOSE FOR BXR INDEX
Today the BXR Index closed at 183.26, its highest ever weekly closing value. The BXR Index is up more than 83% since the base date of its index history – Dec. 29, 2000.
The CBOE Russell 2000 BuyWrite Index (BXR) is a benchmark index that measures the performance of a theoretical portfolio that sells Russell 2000 Index (RUT) call options, against a portfolio of the stocks included in the Russell 2000 Index. A “buy-write,” also called a covered call, generally is considered to be an investment strategy in which an investor buys a stock or a basket of stocks, and also sells call options that correspond to the stock or basket of stocks.
GROSS PREMIUMS FOR BXR INDEX – AVERAGE OF 2.3% PER MONTH
In light of the fact that the CBOE Russell 2000 Volatility Index has had higher average values than many other volatility indexes in recent years, the BXR Index has generated relatively high gross premiums that have averaged around 2.3% per month. Please note that net returns for a buy-write strategy often are much less than the gross premiums received.
Today Russell Investments announced exclusive agreements with NYSE Euronext and CBOE Holdings for Russell U.S. index options.
The Russell 2000 (RUT) Index is a leading benchmark for the performance of small-capitalization stocks. CBOE has offered options on the Russell 2000® Index (RUT) since 1992. Today total open interest for RUT options is 809,768 (335,634 calls and 474,134 puts). Investors use RUT index options strategies such as collars for protection and buy-writes for income.
To learn more about buy-write strategies and indexes, and to link to White Papers by Russell Investments, Ibbotson Associates, and other firms, please visit www.cboe.com/buywrite.