Managed Futures & Forex
For details of managed funds, please contact us
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Below are details of system trading:
Due to the high leverage of commodity
trading, speculation in futures and forex is widely thought of as a 'high
risk' investment and, by association, managed futures has been given the
same label. However, this is rather unfair as the latest reports by the CISDM alternative investment database illustrate
that the average annualized
standard deviation of individual CTAs (Commodity Trading Advisors) are, on average, lower than that of
the average deviation of the Dow Jones 30 Industrial Average (27.12%
compared to 29.51%). This shows that the risk of using managed
futures/forex
can, in fact, be less risky than investing in an index-linked, more
traditional stock investment. Moreover, diversifying one's assets amongst a
group of trading systems can further reduce changes in market volatility.
The way in which managed futures or forex positions
are added differ from traditional stock and bond portfolios and hedge funds,
which often tracking indices that reflect trend-following patterns. Referred to as
'absolute return' strategies, the results of managed futures and forex investments are
based on the success of the trading system, not dependent on the long-term direction
of the market.
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