“For now consider perhaps the most interesting oddity in a direct managed futures account, something unheard of in the hedge fund world: transparency, the ability to clearly see an investment in the light of day.”
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Managed futures performed relatively well for April as commodities continued to trend higher during the month, a report by Lipper Tass says.
Long exposures to equities and large speculative short trades in euro futures sustained manager performance.
This TV report is produced with slick journalistic production values you would expect from Bloomberg, but like many early media reports defines managed futures by trend following, which is not accurate. Trend following is one of four primary strategies, which we point out in the book. If one confines themselves to just the trend followers [...]
Counter trend traders in the S&P 500 e-mini futures made some very interesting trades, potentially pointing to a short term stock market bottom.
“There is an asset class that has been generally ignored by Wall Street – despite outperforming the stock market over twenty-seven years, according to one of the most recent studies on the topic… While many Wall Street institutions benefit through their portfolio investments in this asset class, the investment has been misunderstood by many financial advisors, as well as . . . “
It is interesting to watch traditional Wall Street slowly come to grips with managed futures. After a series of mutual fund offerings that were essentially a replicate of simple trend following systems, here is an intelligent individual who grasps the value of diversification.
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Managed futures has a reputation for performing independent of the stock market, and that held true during the recent stock market “flash crash(s),” equity market meltdowns that punctuate the real risk in overexposure to one asset class, the stock market.
Friday, May 28, 2010
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