Interview with Jerry Haworth

Featuring Jerry Haworth

CIO & Co-founder of 36 South, Jerry Haworth gives his outlook on market volatility and what drives it, expanding on the mechanics of the options market. Find out more at

Published on
7 August, 2016
Investment Framework, Derivatives, Global Investment
38 minutes
Asset class
Equities, Currencies, Bonds/Rates/Credit


  • AP

    A P.

    5 11 2016 09:29

    1       0

    One of the pleasures of RVTV: rediscovering an interview you've forgotten about. This one is a classic. Many thanks, Raoul and team. Please do a follow-up!

  • PB

    Pieter B.

    15 10 2016 15:10

    0       0

    Great new insights. Thanks for the fantastic interview!

  • DV

    Dan V.

    23 8 2016 03:04

    0       1

    Great interview. Although selling option vol is not as dangerous if one is covered on the underlying (ie simple buy write strategy) or buy way of hedging the downside. Or am I wrong?

  • N

    Norman .

    16 8 2016 17:41

    0       0

    Fantastic interview and strategy.

  • CB

    C B.

    15 8 2016 18:10

    1       0

    Just fantastic. So well explained and truly fascinating insights. We need to hear more from managers who own and traded truly diversifying asset classes!

  • MB

    Matthias B.

    9 8 2016 19:05

    3       0

    PS: the cherry on the cake cake truly was.. "the strenght of the yen is an intelectual insult.." I do sometimes question whether studying economis was worth the ordeal as current events/actions clearly defy gravity. but rvtv helped to keep some senses ( and sanity)

  • MB

    Matthias B.

    9 8 2016 19:02

    1       0

    ..."these ETFs trading around the VIX are a sure trap to lose money.." I wish to have seen this video 3 weeks ago because I was dumb enough to exactly do that ... and lost buckets... this was a high quality discussion. would love to hear more about the topic, especially how CBs are able to supress vola for that long that much. RVTV is a gift that keeps giving! tks

  • jg

    james g.

    9 8 2016 12:32

    2       0

    awesome.more options focused interviews please.

  • jm

    jim m.

    8 8 2016 05:18

    8       0

    I met Jerry years ago at his New Zealand home where he was kind enough to introduce me to his trading strategy. I find him to be candid and humble; qualities I enjoy. The greatest opportunity for asymetric returns is in the "wings". Counterparty risk is real when correlations go to 1. I noticed Raoul tried to nudge Jerry in the direction of discussing macro risks. It is evident that Jerry, like many of us, see deleterious medium term effects to radical central bank policy. But that likely does not mean he attaches too much importance to fundamentals. I discussed with him the fundamentals of owning assets which rise with inflation in 2010. Of course I was wrong in my thesis. But the point is that Jerry dismissed fundamentals and instead made clear his view that one buys Vol on assets when Vol is historically cheap and one sells Vol on assets when Vol is expensive. In other words I do not see his trading strategy as being one which relies on fundamentals or macro. Great interview.

  • BC

    Ben C.

    8 8 2016 02:54

    8       0

    Excellent interview! A couple questions as an average individual investor:
    How can I buy 5-yr to 10-yr options??
    What is an efficient way to buy options on the long gold / long dollar correlation trade that Raoul suggests?

  • PC

    Peter C.

    7 8 2016 17:45

    6       0

    Great interview. Raoul got us more from his thoughtful questions and comments. I really like RV bringing us different perspectives from different players and like Jerry that are at the extremities.

  • TM

    The-First-James M.

    7 8 2016 07:44

    3       0

    Interesting to listen to the discussion about an increasing number of services offering Retail Investors such as myself the opportunity to sell/write put and call options. The following service - affiliated to Bill Bonner's Agora Publishing - is now doing this in Australia:

    To be fair to them, in their marketing they do make it clear that you should have the funds to purchase the shares if you've sold a put to somebody. However, I sense that some people may end up complacently over-exposed to this risk. Time will tell over on this side of the World. Personally, this strategy interests me but it's not something I'm looking at doing until I have a much better understanding of options trading, and I appreciate the analogy comparing this to picking up nickels in front of a steamroller. Guess it's important to only sell puts on stocks you actually want to own...

  • SP

    Steve P.

    7 8 2016 06:26

    9       0

    One obvious question - what is the level of counter party risk in a major fall out when all correlations hit 1 ??

    Great Interview. Love the diversity of interviews the past month RV. Fabulous!!

  • WM

    Will M.

    6 8 2016 20:10

    9       0

    Very interesting indeed. Whats the best way to play long $ + long gold optionality?

  • JM

    Justin M.

    6 8 2016 16:17

    5       0

    Excellent piece. This interview pretty much sums up my core thesis for the past 5 years. Thanks for taking the time. Would love to hear an update in the future.

  • CD

    Charles D.

    6 8 2016 16:00

    5       0

    I thought the key to the conversation was that with short term options u almost always wind up with a negative cost to carry....much longer term options...leaps...allow for enough time to give the event a chance to evolve.

  • CD

    Charles D.

    6 8 2016 15:56

    0       0


  • GS

    Gordon S.

    6 8 2016 10:45

    2       0

    Great piece! Loved all the analogies used. What are your thoughts about central bank's way of suppressing volatility. The indirect way is clear, but what about the direct way? There was once a hint on ZeroHedge that some central banks might even actively trade volatility like selling VIX or SPY puts. (CME even listing price rebates for central bank trading if I remember correctly). Thanks Hubert S. for the question, would also love to know. Thanks Daniel P. for the hint. I took a look and the platform and it looks clunky and for Windows only. Might be good for trading, but can you get good charts there? Like those for example? , or do you get these only via Bloomberg? (Unaffordable for small retailers…)

  • CG

    Colin G.

    6 8 2016 09:14

    2       0

    ^sparkle in the diamond

  • CG

    Colin G.

    6 8 2016 09:13

    3       0

    unexpectedly one of the best - the spark in the diamond that is RV!

  • TH

    Timo H.

    6 8 2016 06:51

    11       1

    Good stuff. Just wondering what happens to options market when hypervolatility hits the fan in FX market. Do we then have a realizing counterparty risk that kills the whole market?

  • se

    shawn e.

    6 8 2016 04:32

    3       0

    Fabulous interview R! Was waiting for this part of the overall picture.

  • PA

    Paul A.

    6 8 2016 00:27

    3       0

    When they got to gold and currency they had me hooked. A great interview.

  • JS

    John S.

    5 8 2016 22:21

    2       0


  • DP

    Daniel P.

    5 8 2016 20:58

    4       0

    Hubert, try Saxo for long dated fx options,
    I knew a lot of FXO traders who used them for PA trades.

  • fc

    frank c.

    5 8 2016 19:06

    4       0

    Loved it!

  • RM

    Robert M.

    5 8 2016 18:04

    13       0

    I would also like to know how to buy currency volatility options

  • HS

    Hubert S.

    5 8 2016 15:31

    24       0

    Very much enjoyed it. Just one important thing I missed: The liquid long dated option markets in currencies, which you mentioned at the end: please where is it ? On Exchanges or only OTC for institutions?

  • J

    John .

    5 8 2016 14:29

    12       0

    his comments on wing volatility are the key. It's the wings where the greatest opportunities tend to be