Investment Strategies for Uncertain Times

Lead-Lag Live

The financial landscape has dramatically shifted, leaving income-focused investors struggling to find reliable yield. Traditional bonds no longer serve as the dependable ballast they once were, forcing advisors and retirees to explore alternative paths to consistent income.
Howard Chan, formerly of PIMCO and Goldman Sachs, shares how his firm Kurv Investments is addressing this challenge through volatility harvesting strategies that transform growth-oriented technology stocks into income-generating powerhouses. This approach solves a fundamental dilemma: no longer must investors choose between growth potential and current income – they can potentially have both.
What makes these strategies particularly valuable today is the breakdown of traditional asset correlations. The negative relationship between stocks and bonds that underpinned the classic 60/40 portfolio has weakened significantly, with both assets sometimes declining simultaneously during market stress. Volatility itself has emerged as an effective portfolio diversifier with a -0.8 correlation to equity markets this year.
Through covered call writing on high-volatility tech names, these strategies can generate substantial yields (7-14% annually) while maintaining some upside participation. The approach follows a four-step framework for navigating market turbulence: mitigating downside during corrections, generating income while awaiting clarity, repositioning for rebounds, and then capturing upside during risk-on periods.
Particularly enlightening is Howard's warning about NAV erosion in high-yield ETFs – when funds promise distributions above what markets can sustainably deliver, they must return principal to maintain their stated yield, creating a slow death spiral for investor capital. This critical concept is often overlooked by yield-hungry retail investors.
For those approaching or in retirement who rely on portfolio income rather than total return, these alternative income streams may provide the consistency and tax efficiency that traditional fixed income currently lacks. As Howard notes, with US debt growing at 7% while GDP grows at just 2-3%, challenging fiscal choices lie ahead – making thoughtful income strategies more essential than ever.

With ChatDOC, instantly analyze professional documents using AI — featuring word-level citations, chart/formula breakdowns, cross-file query, and full support for PDFs/epub/scanned files.
Free version handles 10 documents (up to 3000 pages) and cross-searches 30 files.
Click the link below to unlock +10 document slots : https://chatdoc.com?src=leadlaglive

Sign up to The Lead-Lag Report on Substack and get 30% off the annual subscription today by visiting http://theleadlag.report/leadlaglive.

Foodies unite…with HowUdish!
It’s social media with a secret sauce: FOOD! The world’s first network for food enthusiasts. HowUdish connects foodies across the world!
Share kitchen tips and recipe hacks. Discover hidden gem food joints and street food. Find foodies like you, connect, chat and organize meet-ups!
HowUdish makes it simple to connect through food anywhere in the world.
So, how do YOU dish? Download HowUdish on the Apple App Store today: Support the show

Chapters

1. Finding Income in Unconventional Ways (00:00:00)

2. Howard Chan's Investment Background (00:05:05)

3. Retail's Hunger for Higher Yield (00:09:10)

4. Using Volatility as Portfolio Diversifier (00:15:51)

5. Four-Step Volatility Strategy Framework (00:21:51)

6. Performance During Market Corrections (00:31:20)

7. Curve Investment's Product Lineup (00:38:13)

8. Single Stock vs. Index Strategies (00:43:18)

9. NAV Erosion and Distribution Consistency (00:47:15)

10. Economic Outlook and Tech Sector (00:49:18)