by William Upton at The National Pulse
Former House Speaker Nancy Pelosi well-outperformed the market in terms of her personal investments in 2023. The 83-year- old Democrat from San Francisco realized a 65 percent return on her stock portfolio – the S&P 500 meanwhile only saw a 24 percent overall return in 2023. Pelosi’s market success last year is even more remarkable as in 2022 her portfolio actually took a hit of nearly 20 percent.
Pelosi’s financial disclosures indicate that the questionable use of ‘stock options’ was the primary driver of her portfolio’s turn-around. When using stock options, an investor has the right to buy-or-sell a stock at an agreed upon price at a set date. The two types of options used by investors are ‘puts’ and ‘calls’. A ‘put’ is when an investor essentially makes a bet a given stock’s price will fall. A ‘call’ is when they bet the price will rise.
Options Trading Or Insider Trading?
Stock options are most frequently used by major investment firms and professional traders who can dedicate a great deal of time and resources to find arbitrage opportunities where a ‘put’ or ‘call’ could drastically increase the return for them and their investors. However, the use of options also comes with a great deal of risk, as placing the wrong bet could be financially devastating to the investor or firm.
The increased use of stock options by Members of Congress…Continue Reading