The futures market is often seen as a casino, a legal betting parlor for speculators of the kind portrayed in the 1983 movie “Trading Places.” Futures are speculative, leveraged instruments and aggressive traders can lose big, but these derivatives also can be prudent ways to diversify portfolios and hedge against losses in volatile markets.
Commodities, stocks, Treasury bonds, global currencies — even the weather — are among the many types of investments tied to futures. Buying and selling takes a high level of sophistication, and that’s why futures are mostly a tool for institutions, hedge funds, trading firms and wealthy investors………………………………………..Full Article: Source

Managed futures is very unique, because it’s one of the only asset classes that has very low correlation to almost every other type of investment. So if you look at how managed futures correlates to equity markets, basically the term would be, it really has no correlation.
And what that means is: That it doesn’t really move in any predictive pattern to how equity markets move. It means if equity markets go up, managed futures could move up with it. If markets go down, they can move down with it, or they could be the opposite, where if the markets are moving down, managed futures is up………………………………………..Full Article: Source

As managed futures have grown in popularity, it is important to understand why many seek to diversify their traditional stock and bond portfolios to include this alternative asset class, including: Potential for returns in up and down markets: The flexibility and ease in taking long and short positions allows profit both from rising as well as falling markets.
Noncorrelation to traditional investments: Returns of managed futures strategies have historically been noncorrelated to traditional stock and bond market returns over long-term periods………………………………………..Full Article: Source

RBC Capital Markets today reported that for the month of April 2012 the RBC Hedge 250 Index had a net return of -0.04 per cent. This brings the year-to-date return of the Index to 3.37 per cent.
Managed futures funds provided the only bright light in April, with gains of 2.13%, bringing their YTD returns to 0.05%. All other strategies were flat or negative for the month (Press Release)

The Dow Jones Credit Suisse Hedge Fund Index finished down 0.04% for the month of April. Performance for the Broad Index and its 10 sub-strategies is calculated monthly. March, April and YTD 2012. Among the worst-performing sub-strategies last month were dedicated short-bias funds (-2.53%), long/short equity (-0.46%) and equity market-neutral (-0.41%).
Meanwhile, the best-performing ones included fixed-income arbitrage (0.69%), multi-strategy (0.58%) and managed futures (0.43%). (Press Release)

The appeal of commodity pools is that they play off of headlines: Gold is up! Copper is soaring! Silver is through the roof! A growing number of scams have emerged in recent years that prey upon investors who get suckered into the idea that a brilliant trader is more than happy to help them get a piece of the action.
By investing in a pool of commodities — anything from precious metals to agricultural goods — you can reap millions from this market………………………………………..Full Article: Source

A growing majority of global investors would like to see more stimulative fiscal policies from governments around the world, amid resurgent fears about the Greek economy, according to the BofA Merrill Lynch Survey of Fund Managers for May.
The proportion of global investors saying global fiscal policy is “too restrictive” has more than doubled to a net 23 percent from a net 11 percent in April. The survey took place from May 4 to May 10, after elections in France and Greece. Nearly two-thirds of investors are concerned that Greece will be the source of a negative surprise this year, up sharply from 48 percent in April………………………………………..Full Article: Source

As individuals bail out of U.S. stocks at the fastest rate in three decades, professional speculators have cut bearish bets by the most since 2008. Money managers are net short 19,375 contracts on the Standard & Poor’s 500 Index, down 82 percent from a four-year high in September even after the figure jumped from 3,584 last week, data compiled by Bloomberg and the Commodity Futures Trading Commission show.
U.S. equity mutual funds recorded $18 billion of outflows in April, the most since at least 1984, according to preliminary data from the Investment Company Institute………………………………………..Full Article: Source

Operating a futures exchange has become a highly competitive business, and exchanges worldwide are constantly looking for ways to boost volume. Both ICE and CME Group – the holding company for CME and CBOT plus NYMEX (New York Mercantile Exchange) and COMEX (Commodity Exchange) – are publicly-traded, for-profit companies; ELX is a privately-held corporation owned by a group of investment banks, trading firms and technology providers.
Unlike the clubby old days of member-owned exchanges, most exchanges today are owned by shareholders who expect these firms to not just make a profit, but to make those profits grow year after year………………………………………..Full Article: Source

Shanghai Futures Exchange (SFE) started the trading of China’s first silver futures exchange on Thursday. On the first trading day, the benchmark listing price was 6,166 yuan ($979.77) per kg, according to statistics released by the SFE.
And the first batch of eight listed futures contracts received the accumulative amount of 349,100 hands………………………………………..Full Article: Source

Switzerland-based investment manager Blue Capital is set to begin marketing its flagship managed futures strategy to outside investors, four years after its initial debut in December 2007.
The Alphea-Systematic Trading Fund will target high-net-worth individuals, family offices and smaller funds of hedge funds in the US and Europe, outside Italy, to achieve a soft close of €300m ($394m), said fund director Patrick Fietje………………………………………..Full Article: Source

Credit Suisse’s Asset Management Division announced the launch of the Credit Suisse Liquid Alternative Fund. This innovative product seeks to offer access to hedge fund-like returns, with the flexibility of daily liquidity, increased transparency and 1099 tax reporting. The fund complements the growing suite of alternatives-focused mutual fund offerings available through the Asset Management division of Credit Suisse.
Jordan Drachman, Head of Research for Credit Suisse Alternative Beta Strategies, said, “Hedge funds offer the potential to improve diversification and reduce correlation and portfolio volatility; however, investors needing access to capital are often constrained by hedge funds’ illiquid nature, and the process for investing in offshore vehicles can be tax restrictive, lengthy and expensive.” (Press Release)

Cheyne Capital Management announces the launch of two UCITS IV compliant funds: the Cheyne Global Credit Fund and the Cheyne European Real Estate Bond Fund. Cheyne is the investment manager to the funds with Citibank International plc, Ireland Branch, acting as Administrator and Custodian.
These UCITS funds have been launched in response to investor demand and their investment portfolios are based on those of two existing flagship Cheyne strategies………………………………………..Full Article: Source

Jefferson National, a recognized innovator of products and services for Registered Investment Advisors (RIAs) and fee-based advisors, continues leading the industry in providing tax-deferred investment options to meet advisors’ growing need to overcome the inherent tax-inefficiencies of many alternative asset classes and alternative strategies.
Jefferson National is the first and only variable annuity to offer alternative investment options from BFP Capital Management, W.E. Donoghue and Hatteras Funds, as well as adding even more alternative investment options from such market leaders as Invesco, Legg Mason, Janus, Fidelity Investments and Wilshire Funds Management. (Press Release)

Crystal Wealth Partners has launched a unified managed account solution developed with specialist provider and AMP subsidiary Multiport. Called the Crystal Wealth Managed Account Service, it provides Crystal Wealth’s clients with eight model portfolio options or a tailored discretionary mandate.
The service includes daily portfolio management, comprehensive administration and reporting services. “There is no doubt there’s increased interest in the managed account space and this type of solution can be ideal for specialist practices that have higher net worth clients and SMSFs as a core capability,” said John McIlroy, CEO of Multiport………………………………………..Full Article: Source

Hedge fund managers on the other side of the trades that resulted in over $2 billion in losses at JPMorgan Chase are worried about reports that the Justice Department is investigating the matter, according to a person familiar with the matter.
Several hedge funds took up large trading positions in the credit derivatives market, after they came to believe a London-based trader at JPMorgan had built up a position so large that it was distorting the market. London-based CQS and Blue Mountain Capital were two of the hedge funds on the other side of the JPMorgan trade, according to sources cited by Reuters………………………………………..Full Article: Source

Investors in some of the best-known commodity hedge funds are getting increasingly frustrated by their performance, with some heading for the exit as managers rack up a second year of losses.
Some major funds focused on energy, metals and agricultural products have fallen this year after traders - still cautious about big bets following last year’s losses - sought to protect themselves against rising volatility just as it fell………………………………………..Full Article: Source

Speculators cut bets on a rally in commodities by the most since November as Greece’s struggle to form a new government and weaker-than-expected industrial output in China erased this year’s gains in raw materials.
Money managers reduced net-long positions across 18 U.S. futures and options by 19 percent to 723,239 contracts in the week ended May 8, the biggest decline since Nov. 22, Commodity Futures Trading Commission data show………………………………………..Full Article: Source

$5bn is the magic number for hedge fund success when it comes to attracting capital, according to participants speaking on hedge fund allocations at the SALT Conference which started today in Las Vegas, Nevada. The SALT Conference is a global conference that attracts financial, business and policy leaders from around the world. During a panel that amassed several notable industry professionals.
Capital inflows continue to go to bigger brand name funds, despite data showing that emerging managers tend to outperform larger, more risk averse funds. “This type of allocation shows a lack of conviction among investors,” said Kenneth J. Heinz, CFA President of Hedge Fund Research, Inc. of the trend. He notes that investors are more focused on potential losses than potential returns in spite of some shorter term losses………………………………………..Full Article: Source

Americans might have had enough of hedge strategists, but the truth is that investors use hedging strategies to protect investments. If investors have a portfolio that’s long the S&P 500, it can buy S&P index option puts to protect that position in a bear market and lose less.
If a farmer wants to protect from falling corn and soybean prices, it can lock in the price in the futures market, also a hedging strategy………………………………………..Full Article: Source

“In a deflationary environment, it is very hard for investors to hide,” Cantor Fitzgerald’s John Trammell said, who went on to note an investment that offers a family office a hedge to their beta exposure would be of interest.
The general benefit of managed futures investments are their lack of strategic correlation to the variables of economic strength. Most investments are based on the concept of an asset-stock, real estate, commodity-rising in value. Managed futures is a slightly different animal in that, due to the different market environment considerations, managed futures can deliver returns independent of the rising or falling value of assets. In other words, managed futures trend followers could perform positively in a deflationary environment so long as such an environment created consistent price trends………………………………………..Full Article: Source