# How Judy Greer Might Suggest Cheryl Tunt Hedge Her Portfolio

I’m using my blogging ability to wish a happy birthday to an American Treasure, Judy Greer.  Greer first caught my eye as the younger sister in the under-appreciated classic Chicago movie, Kissing a Fool.  Many people may remember her as Jennifer Garner’s enemy in 13 Going on 30 (I was rooting for Judy’s character).  She’s also appeared in many TV shows such as Arrested Development and Two and a Half Men.  My favorite role, however, just uses Judy’s voice as Cheryl Tunt in my favorite animated series Archer.  For those unfamiliar with her character in Archer, she works as a receptionist, but is extremely wealthy.  I would assume with such wealth Cheryl has a very diversified portfolio and if she watches the markets closely may sometimes be concerned about a pullback in the stock market.  If Judy Greer’s talents include knowledge of the option markets I believe she would suggest Cheryl Tunt consider a collar with SPX options to lock in the value of her portfolio in a low cost manner.

With anticipation that the S&P 500 may give up 10% or 20% and take Cheryl’s fortune down with it, Judy may suggest buying S&P 500 (SPX) put options in a dollar amount equal to the value of her portfolio and then selling SPX call options to help pay for that protection.  The result can be locking in the value of a portfolio, but of course, giving up any upside.  With 100’s of millions of dollars in the bank, Cheryl Tunt probably would be most concerned with preserving that capital than growing it, I mean how much money does a girl need?

As a more specific example, the S&P 500 is trading around 2160 as I type this, if Cheryl were concerned about the stock market through the end of August she may consider purchasing the SPX Aug 31st 2160 Put for 34.10 and selling the SPX Aug 31st 2160 Call for 29.10 and a net cost of 5.00 per collar or \$500 before commissions.  This would cost about 0.25% of the portfolio value since the notional value of each of these SPX options is equal to \$216,000.  The result of this would be sacrificing any market upside, but being assured that in the case of some sort of market correction, the value of her stock portfolio is safe.  At least through August 31st.