Optimistic outlook for managed futures
Pensions & Investments – Lawrence Kissko
After a challenging few years for managed futures, 2014 was a welcome change with a positive year for the investment style; the Barclays BTOP50 index returned 12.3%. Many investors question whether this will continue. We believe there are several reasons to be optimistic. Our outlook considers two factors that historically have played a significant role in managed futures’ performance: correlation and trends.
**JK: BarclayHedge says total assets under management for managed futures totals $316.8 billion.
Buyer Beware With Managed-Futures Funds
By Jason Kephart – Morningstar
After languishing for several years, managed-futures funds bounced back in 2014, with the average fund notching a 9% return. Investors appear to have taken notice, pumping more than $1.4 billion into the category in the first two months of 2015, including a single-month record of $800 million in January.
**JK – But he goes on to say that managed futures are “too pricey, too opaque or unproven.” Which also sounds like a lot of mutual funds and ETFs.
Managed Futures: In At The Highs, Out At The Lows
The more troubling sign is that the people didn’t just get in at the bottom – a lot of money got in at the top as well, having poured $44 Billion into managed futures following gains of $7.56% between Jul 2010 and April 2011. What does this mean for the rest of 2015, where money should be flowing into the asset class following an impressive year?
Drury Capital Says Buffett Could Use Some Diversification
As Warren Buffett is once again in the corporate takeover news, this time as an observer as close confidants at 3G Capital create one of the largest food processing conglomerates in the world, a Princeton, New Jersey hedge fund thinks the right ingredient Buffet needs in his portfolio is a dash of non-correlated performance.
Drury Capital is providing investors some advice about their Buffett exposure: this meal goes better with a smooth glass of wine rather than by going it alone. Drury, one of the leading trend followers in the managed futures industry, delivering 75 percent positive returns in 2008, among the highest inside an industry known for its crisis alpha.
**JK – A weapon for Warren’s arsenal.
Taylor-Swift Lawsuit: ‘I’ve Got a Blank Space Baby.’
In a class action lawsuit filed in the Northern District of Illinois, HTG Capital Partners claims that the U.S. Treasury futures market is rigged by a user of the HFT tactic of “spoofing.”
**JK – Ever been spoofed?
BarclayHedge | Barclay CTA Index Slips 0.07% in February; Trend Reversals Challenge Managed Futures Traders
Managed futures traders were down 0.07% in February according to the Barclay CTA Index compiled by BarclayHedge. The Index remains up 3.02% year to date.
Managed Futures/Managed Funds
Are managed futures the way forward? | World Finance
Demand is growing for managed futures’ “attractive, consistent, and well-correlated returns over time”
Notz Stucki’s Paolo Faraone and CM Capital Markets’ Tomas Saldaña and Manel Sarabia discuss bringing real-time transparency to the managed futures industry.
Abbey Capital Futures Strategy Fund surpasses USD100 million AUM
The Abbey Capital Futures Strategy Fund has surpassed USD100 million in assets under management. The fund, Abbey Capital’s first 1940 Act liquid alternative mutual fund, launched on 1 July 2014 and has returned over 26 per cent since inception.
CTAs as a fixed income hedge
CTA Intelligence – Yoav Git, head of fixed Income, and Graham Robertson, client portfolio manager, Man AHL
As trend-followers, for the most part, the CTA industry promotes itself as having ‘insurance-like’ properties.
Combining systematic investing with fundamental-macro
CTA Intelligence – Aref Karim, CEO and CIO, QCM
A quantamental approach
ArefKarim_QCM_NEWSystematic investing, in the form of managed futures, rose to the attention of the investment community particularly through its performance in 2008, when it delivered strong returns against the dramatic losses posted by most other strategies.
Does the hedge fund industry benefit society?
allaboutalpha.com – Donald A. Steinbrugge
It is no secret that the hedge fund industry is viewed negatively by a large portion of the general public, but should it be? Such a perception is driven primarily by the fact that most hedge funds are not permitted to market themselves to the general public, and because the mainstream media has a negative bias toward their coverage of the industry. The average person is inundated with negative articles creating the image that: 1.) Most hedge fund managers are dishonest and frequently commit fraud or violate insider trading laws. 2.) Hedge funds are highly risky investments. 3.) Their devious actions are bad for the general public. 4.) Hedge funds generate bad performance and their fees are too high.
Apax Said to Return $4.5 Billion to Investors in Three Months
Kiel Porter – Bloomberg
Apax Partners has returned 4.2 billion euros ($4.5 billion) to investors in the past three months from one of Europe’s largest buyout funds raised before the financial crisis, said people with knowledge of the matter.
Hedge Fund Traders Return to Fray With $1 Billion Launches; Proven managers starting new ventures are catching the eye of investors
By LAURENCE FLETCHER, The Wall Street Journal
Several big-name traders are launching hedge funds in the U.K.’s capital as a surge in startups gathers momentum.
Q&A with OTC Global Holdings: Get to Know the New Energy Market That’s Coming to TT
TT Trade Talk
Recently at the FIA Boca conference, in addition to announcing the broad availability of TT, we announced that the new platform will provide customers access to OTC Global Holdings’ (OTCGH’s) EOXLive Active Markets.
To summarize, customers will be able to access EOXLive’s unique commodities market information and liquidity on the next-generation TT platform.
Follow Kim Bang on Linkedin
Top Traders Unplugged
“If you want to be in this space at the cutting edge and you want to compete, you have to be somewhat original. Not completely from scratch, but somewhat original in the way you extract earnings.” – Kim Bang (Tweet)
Pensions & Institutions
Hedge funds: What’s in it for pension plans?
The decision made last September by CalPERS to divest its USD4bn hedge fund investment plan came as quite a shock to the industry. Then, in early January this year, PFZW, the EUR156 billion Dutch healthcare scheme, announced that it had ended its exposure to hedge funds in December 2014.
The question that arises from these decisions is: will more pension plans turn their backs on hedge funds in 2015?
For Jean-Marc Stenger, CIO, Lyxor Alternative Investments, the above events are outliers rather than representing a symptom of a wider trend.
“When speaking to our investors and market prospects we don’t get a sense that this is the start of a new trend; quite the opposite. These were very specific cases. Overall, institutional investors continue to allocate strongly to hedge funds. I saw a figure from Preqin the other day that more than USD450 billion had been added to global hedge funds in 2014,” says Stenger.
Colorado’s public retirement system adds risk, chases return
By Joshua Sharf – Watchdog Arena
Colorado Public Employees’ Retirement Association (PERA), in an email last week, announced that it has adopted a new long-term asset allocation strategy that will add risk to its portfolio, shifting money from stocks and bonds and into real estate and alternative investments.
A well endowed domestic pension fund in India will be the panacea for a robust and sustainable capital market
Business Standard News
A well endowed domestic pension fund in India will be the panacea for a robust and sustainable capital market. Speaking at the 6th Capital Markets Summit of Confederation of Indian Industry, Chairman of Securities and Exchange Board of India (SEBI) mentioned that India does not have too many large domestic institutional investors who could invest in Indian capital markets.
**JK – Our headline of the day.
CFTC enforcement action against energy company acting as unregistered CTA — words to the wise for investment advisers relying on CTA exemptions
A recent enforcement action by the Commodity Futures Trading Commission (CFTC) serves as a reminder of the importance the CFTC places on registration of commodity trading advisors (CTAs) in its regulatory scheme, and of the care with which the agency will review reliance on exemptions from CTA registration.
Regulatory purge on deceptive marketing continues as NFA goes after 28-year established firm | LeapRate
Established in 1987, PAMC is under scrutiny from the NFA for allegedly soliciting clients by using misleading promotional material that promised dramatic profits, and contained hypothetical trading results