How are Managed Futures used in an investment portfolio?
With prudent allocation, Managed Futures may help reduce the overall risk of a portfolio. A prudent investor should ensure that at least a portion of their portfolio is allocated to an alternative asset class that has the potential to perform well when other portions of the portfolio may be underperforming. Other potential benefits of managed futures may include: • Historically competitive returns over the longer term • Returns independent of traditional stock and bond markets • Access to global markets • The unique implementation of traditional and non–traditional trading styles • Potential exposure to as many as one hundred and fifty markets globally • Liquidity and no lock–ups. The contracts in which the CTA´s trade typically have a high degree of liquidity. If suitable to a client´s objectives, devoting five to fifteen percent of a typical portfolio to alternative investments has been shown to increase returns and lower volatility. Because alternative investments may not react in t
