Panels have continued this afternoon at the iGlobal Alternative Investment Summit, with some great perspectives shared. First up was a panel discussing various hedge fund strategies, with a well-deserved focus on managed futures. Donald Steinbrugge of Agecroft Partners and Justin Shepard of Aurora Investment Management both pointed the space out, highlighting the fact that the asset class has grown faster in assets than any other hedge fund strategy in the past decade. As Steinbrugge put it, “If you’re a pension fund of size, you’re looking at managed futures.”
Another interesting comment related to the size of CTAs that investors have gravitated towards. Size, apparently, is everything. Shocking, right? But at this point, the head shaking continues. As we’ve written about in the past, our research indicates that large CTAs frequently experience a flattening out of returns. Depending on the investor goals, this means that bigger isn’t always better, and this allocation strategy may not yield the desired results from the asset class.
The regulatory panel that followed was also pretty intriguing. The discussion started with that beautiful piece of law that was longer than the US tax code, and perhaps even more hated: Dodd-Frank. Gregory Nowak of Pepper Hamilton LLP spent a good amount of time detailing all the ways in which the law had intended to provide clarity and transparency and failed miserably. With the Fed revealing that they will soon vote on Basel III and Congressional bickering over Dodd-Frank resuming with the fast approaching Volcker rule deadline, the general consensus seems to be that there will no rest for the wicked anytime soon. And that’s why Nowack jokingly referred to Dodd-Frank as an employment guarantee for lawyers.
And for those that were hoping the election and a new administration might help things, don’t bet on it. As panelist Steven Goldburg of Grant Thornton LLP put it, it comes down to Congressional control, and the odds of Republicans getting to that magic 60 vote level in the Senate are slim. As Nowack added, “Change? Not for at least another decade.”
The performance data displayed herein is compiled from various sources, including BarclayHedge, and reports directly from the advisors. These performance figures should not be relied on independent of the individual advisor's disclosure document, which has important information regarding the method of calculation used, whether or not the performance includes proprietary results, and other important footnotes on the advisor's track record.
Benchmark index performance is for the constituents of that index only, and does not represent the entire universe of possible investments within that asset class. And further, that there can be limitations and biases to indices such as survivorship, self reporting, and instant history.
Managed futures accounts can subject to substantial charges for management and advisory fees. The numbers within this website include all such fees, but it may be necessary for those accounts that are subject to these charges to make substantial trading profits in the future to avoid depletion or exhaustion of their assets.
Investors interested in investing with a managed futures program (excepting those programs which are offered exclusively to qualified eligible persons as that term is defined by CFTC regulation 4.7) will be required to receive and sign off on a disclosure document in compliance with certain CFT rules The disclosure documents contains a complete description of the principal risk factors and each fee to be charged to your account by the CTA, as well as the composite performance of accounts under the CTA's management over at least the most recent five years. Investor interested in investing in any of the programs on this website are urged to carefully read these disclosure documents, including, but not limited to the performance information, before investing in any such programs.
Those investors who are qualified eligible persons as that term is defined by CFTC regulation 4.7 and interested in investing in a program exempt from having to provide a disclosure document and considered by the regulations to be sophisticated enough to understand the risks and be able to interpret the accuracy and completeness of any performance information on their own.
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