Honors Program

University Honors

Date of Award


Thesis Professor(s)

William J. Trainor

Thesis Professor Department

Economics and Finance

Thesis Reader(s)

Son Wilson


This study uses barbell strategies on the S&P 500 and the NASDAQ 100 to explore if funds invested primarily in fixed income assets with a portion of the investment placed in in-the-money call options can participate in upside potential, while also reducing risk. This study examines call options on the underlying indexes as well as their leveraged, 2x and 3x, counterparts. The barbell strategy studied, 88% in fixed income bonds and 12% in call options, does not have a higher return than the underlying index, and adds additional risk. However, a weighted portfolio with combinations of a risk-free asset and leveraged ETF does provide a higher return on investment, with a decreased risk as compared to the underlying index.


East Tennessee State University

Document Type

Honors Thesis - Open Access

Creative Commons License

Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.


Copyright by the authors.