Managed Futures Trading-Commodity Trading Advisors

Learn the most effective strategies for buying and selling options on futures contracts. Also learn producer and consumer hedging strategies.

What is managed futures trading? A commodity pool and managed futures trading is similar to a stock mutual fund in which investors give money to a professional money manager in the hopes of gaining a profit on the investment. Managed futures differ in that they are more leveraged than a stock portfolio which at a maximum is 2 times leveraged whereas a managed futures account may be leveraged upwards of 15 times depending upon the manager. This extra leverage can make managed futures trading significantly more risky than a stock mutual fund account.

Who is trading the managed futures trading account? The professional managers of a managed futures trading account are called commodity trading advisors or CTA's. Commodity trading advisors must be registered with the CFTC and meet minimum experience requirements.

What are the benefits of managed futures trading accounts? Managed futures trading accounts can lower risk and volatility and potentially increase profits when added to a well diversified investment portfolio consisting of stocks and bonds.

A managed futures trading account is transparent and investors can see the trades done for their account daily.

A managed futures trading account can potentially profit in a deflationary or inflationary economic cycle.

Managed futures trading accounts are not biased to rising markets or falling markets. For instance, stock mutual funds usually have strict parameters about investment strategies and are usually biased to higher stock prices and can only profit if the stocks go higher. Managed futures trading accounts can profit in rising an falling markets and lose money in rising and falling markets. Keep in mind that there is substantial risk of loss in managed futures trading accounts.

Managed futures trading accounts give you the ability to profit in any economic environment. Managed futures trading accounts can participate in virtually all sectors of the world economy. However, managed futures trading carries a substantial amount of risk because it is leveraged and there is no guarantee of profits.

What are the risks of managed futures trading accounts? Market risk is ever-present and investing in managed futures trading accounts involves substantial risk and is not suitable for all investors. Past performance is not indicative of future results.

Can I invest in managed futures trading funds in my retirement accounts? Absolutely, managed futures trading funds can be used in qualified 401K and IRA accounts.

Feel free to contact us with any questions that you have about managed futures trading or to view any track records of our various commodity trading advisors.

Futures and options substantial risk of loss and are not suitable for some people. Past performance is not indicative of future results.

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