What is a Commodity Pool?
Commodity pools are funds that receive contributions from a number of investors for the purpose of engaging in trading commodity and futures options. Sometimes referred to as managed futures funds, the commodity pool shares a few characteristics with mutual funds, but operates in a different manner. A commodity pool is an excellent way for smaller investors to join together and take part in a larger investment. Just as with mutual funds, investors who choose to participate in a commodity pool are able to engage in trades that would not be within their grasp otherwise. This makes the use of a commodity pool especially attractive to smaller investors who are not able to meet the margin requirements that are often in place with bigger investments. By contributing resources to a common pool, the group of investors can get around the margin requirements that would apply to the individual investor and qualify for the trade based on their cumulative financial strength. Along with the ability
A commodity pool is a hedge fund that trades futures instead of equities. Commodity pools are also called managed futures funds. The name commodity pool is a National Futures Association (NFA) term; a legal term. The Commodity Futures Trading Commission and the NFA, as opposed to the SEC, regulate commodity pools. Where did you go after Trout Trading? I was working for Trout Trading in downtown Chicago when he moved his headquarters to Bermuda, and my wife and I moved with him. I continued working for him for a couple years, and then in 1995 I joined a reinsurance company that was looking for someone with derivatives experience to help them hedge currency risk and interest rate risk and so on. Because I had a quantitative background, having gone to school in physics, I also got involved with helping the reinsurance company model and manage catastrophe risk from hurricanes and earthquakes. We started a small homeowners insurance company in Florida. About this time, my wife and I wanted
