MANAGED FUTURES VS.
STOCKS
When viewed as an independent investment, managed futures have compared
favorably with U.S. stocks and bonds, as well as international stocks,
over the past decade.
A $10,000 investment in
the Dow Jones-AIG Commodity Index five years ago would have returned
more than 50% through Sept. 30th –
a stellar showing relative to stocks and bonds.
The divergence helps explain pension funds’ growing interest in
the material world.
The
potential for higher performance returns using managed futures compares well
with other asset classes in terms of risk.
•One
way to compare risk is to
measure the magnitude of the worst cumulative loss in value of an investment
from any peak in performance to the subsequent low.
•This
worst-case, peak-to-valley scenario is called a
drawdown
in
the futures industry.
•As this
Chart shows, since 1989 the worst drawdown Managed Futures have had as an
asset class is -15.7%And when compared to time periods when stocks have
shown their worst drawdowns, managed futures have shown positive returns.
Barclay
CTA Index Disclaimer
The Barclay CTA Index is a
leading industry benchmark of Commodity Trading Advisors.
There are currently 326 programs included in the calculation of
the Barclay CTA Index, which is underweighted and rebalanced at the
beginning of each year. To
qualify for inclusion in the CTA Index, an advisor must have four years
of prior performance history.
Additional programs introduced by qualified advisors are not added to
the index until after their second year.
These restrictions, which offset the high turnover rates of
trading advisors as well as their artificially high short-term
performance records, ensure the accuracy and reliability of the Barclay
CTA Index.
THE FOLLOWING MATERIAL
MENTIONS SERVICES WHICH RANK THE PERFORMANCE OF COMMODITY TRADING
ADVISORS. PLEASE NOTE THAT THE
RANKINGS ONLY APPLY TO THOSE CTAs WHICH SUBMIT THEIR TRADING RESULTS.
THE RANKINGS IN NO WAY PURPORT TO BE REPRESENTATIVE OF THE ENTIRE
UNIVERSE OF COMMODITY TRADING ADVISORS.
THE MATERIAL IN NO WAY IMPLIES THAT THESE RESULTS ARE OFFICIALLY
SANCTIONED RESULTS OF THE COMMODITY INDUSTRY.
