the Managed Futures mirage

[nihao1234567890]

If you see:

https://www.barclayhedge.com/managerscorner/perf_ranks/cta/Stock_Index.html

You will see CTAs report their performances based on “composite return” of the entire program (per program) managed by them. It is not per individual client account or "average” of client accounts.

I believe NFA has some rules on how to calculate "composite return”.

 

[Now is Now]

Quote from jimclark:

NFA sells a booklet, you have to pay $25 which as I understand sorts by state/region. Otherwise on their site you can only search by company name.

Thanks ...Jim


NiN

 

[Wallace]

http://www.zulutrade.com and http://rentasignal.com/ are two of many ? alternates
to 'managed funds'. not sure what these companies are known as - signal service ?
they are agencies where individual traders are making some form of payment to
obtain the trades info for manual entry or, trades are made automatically through
the user's account
some 'signalers' have impressive results for a low monthly fee

the above are for fx trading but aren't there similar for the indexes etc ?

 

[1prometheus]

Chicago,

Thanks for following up. Just curious, in your experience what level of commission revenue (what range) will get a broker interested in selling a program? Lets say it is a 100K account.

Thanks all for your contributions.

 

[heech]

Quote from the1:

I used to manage an LP as a CPO and currently run as a CTA. The pattern of chasing returns and bailing on drawdown became so predicitable I had to have one-on-one discussions with investors and put every new investor through a screening process. I rarely, RARELY came across an investor that wanted to invest money during a period of drawdown. A potential investor was interviewing me one day and after all was said and done he said, "call me when you have a 20% correction." My jaw almost hit the ground. I had my 20% correction and he dumped in a bunch of coin. He was the best performing investor that year.

I have to say, I think this is an interesting discussion.

I'm also an "emerging" manager, with 10 months of track record and about $2.5mm AUM (all my own money). Last month, I nearly wet myself when I had a 3-sigma move go against me in one of my core holdings, and took me down 13% at the time. I thought seriously about closing the fund down.

One of my outside investors actually set me straight. He told me that a 10-20% draw-down, while never pleasant, is just a matter of life. He still wanted to invest more funds for July.

I ultimately ended the month "just" down 6.7%. It's still a painful number, but I think the experience has certainly made me stronger. My own emotional reaction certainly helps me understand how a "novice" outside investor might react after seeing a similar draw-down.

 

[jimclark]

Quote from heech:

I have to say, I think this is an interesting discussion.

I'm also an "emerging" manager, with 10 months of track record and about $2.5mm AUM (all my own money). Last month, I nearly wet myself when I had a 3-sigma move go against me in one of my core holdings, and took me down 13% at the time. I thought seriously about closing the fund down.

One of my outside investors actually set me straight. He told me that a 10-20% draw-down, while never pleasant, is just a matter of life. He still wanted to invest more funds for July.

I ultimately ended the month "just" down 6.7%. It's still a painful number, but I think the experience has certainly made me stronger. My own emotional reaction certainly helps me understand how a "novice" outside investor might react after seeing a similar draw-down.

Heech - are you automated or is everything descritionary?

Do you "buy" research or you run your research, fundamental or TA?

Thanks.

 

[myhello2010]

Quote from 1prometheus:

Chicago,

Thanks for following up. Just curious, in your experience what level of commission revenue (what range) will get a broker interested in selling a program? Lets say it is a 100K account.

Thanks all for your contributions.

Beside commission, what percent of the advisory fee a broker shares?

 

[heech]

Quote from jimclark:

Heech - are you automated or is everything descritionary?

Do you "buy" research or you run your research, fundamental or TA?

Thanks.

I'm entirely automated (with some discretion on if/when what strategies are enabled).

 

[Chuck Krug]

Since I'm currently advising + in talks about managing money, i'll throw in my 2 cents. Work with some good banks/ brokers/ money raising firms. And more importantly; don't let individuals invest more than 5% of their liquid net worth in your fund.

 

[1prometheus]

Chuck,

Thank you for your two cents. Would you care to elaborate on what "good" is to you? What in particular are you looking for?