A.J. D'Asaro: The two funds we'll be comparing today are the Gateway Fund (GATEX) and the Schooner Fund (SCNAX). Both of these funds are option collar funds. But they have some key differences investors should be aware of.
Option collar strategies consist of two parts. The first is selling a call, which exchanges the stock market's upside for a fixed payment upfront. And the second part is buying a protective put, which puts a floor if the stock market should fall significantly.
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A.J. D'Asaro does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.