Optimize Advisors has launched the Optimize AI Smart Sentiment Event-Driven ETF (OAIE), an actively managed, long-only fund listed on the New York Stock Exchange Arca with a rigorous, systematic process at its core.
OAIE primarily invests in common stocks with attractive upcoming event opportunities, normally 10 to 30 large-cap constituents with weekly options. It selects its holdings through a proprietary Options Artificial Intelligence “Smart Sentiment” technology, which seeks to distill investment wisdom hidden within the options markets.
“By drawing upon decades of options trading and AI experience, we have developed a smart sentiment and event-driven methodology focused on long-term capital appreciation that we believe can complement client portfolios,” said Optimize Advisors CEO Gideon Agar.
Smart Sentiment Metrics use the prices of the weekly and other options available on a security to assess the overall market’s expectations for the possible price movements of the underlying security. These metrics provide insights into market participants’ detailed risk and reward expectations by capturing the views of “silent” investors.
Optimize Advisors extracts Smart Sentiment Metrics for stocks with upcoming events (primarily earnings calls). These Smart Sentiment stock buying opportunities are ranked by risk/reward. OAIE then buys the most attractive stocks in this ranked list. This process aims to achieve high precision and reduce prediction errors.
“Although passive investing may work well in some market environments, when markets are going through rapid revaluations a more tactical, discriminating and risk managed approach can deliver better results,” Agar added. “Our Smart Sentiment approach aims to be all three.”
A secondary goal of the strategy is to add broad-based equity index and sector ETF positions to reduce concentration risk, maintain a sufficient level of exposure between earnings seasons, and opportunistically trade ETF market and sector events.
OAIE has an expense ratio of 1%.
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