Morgan Stanley backing off equities, moving to managed futures
Noting one of the more significant global economic shifts in market, Morgan Stanley’s Global Investment Committee recommended a decrease in allocation towards equities and an increase in managed futures allocation, among other recommendations.
“The risk of recession in the US and the rest of the developed world has grown significantly in recent weeks, so we are adopting an overweight position in safe havens and an underweight position in risk assets,” the Tactical Asset Allocation Change report noted. “This is the most significant change to our tactical asset allocation in more than two years, as we are decisively moving to bearish from bullish.”
Noting a growing worldwide debt problem that politicians continue to avoid, the report said: “The primary source of the recent financial market distress-with, we think, more to come-has been a combination of policy inaction and ineptness in the US and Europe.”
Such a realistic outlook has resulted in a move towards market neutral investments. “As an asset class, managed futures have low historical correlations to other asset classes, providing a considerable degree of portfolio diversification,” the report noted. “We believe good risk management begins with portfolio diversification, but it doesn’t have to end there. Because managed futures have historically performed well during periods of adverse equity markets, we are adopting a tactical overweight allocation.”
“This is the most significant change to our tactical asset allocation in more than two years, as we are decisively moving to bearish from bullish,” the report noted.
Managed Futures Assets Grow For 12th Month in a Row
Managed futures experienced its 12th consecutive month of asset growth, according to data provider Eurekahedge.
For additional information visit: http://www.eurekahedge.com/indices/index_press_release.asp
Forex Trading Firm Fined $14.2 Million by CFTC
NFA revokes registration of commodity trading advisor, William S. Scott
October 12, Chicago - National Futures Association (NFA) has revoked the registration of William S. Scott of Miami, Florida. Scott is a Commodity Trading Advisor and is the sole principal and associated person (AP).
A designated Subcommittee of NFA's Membership Committee issued the Final Order revoking registration because Scott is subject to an outstanding order from the Florida Supreme Court suspending his license to practice law in the state. Additionally, the Subcommittee found that Scott engaged in conduct, as described by the Florida Supreme Court's decision and corroborated at the hearing before the Subcommittee, that demonstrates a lack of honesty, an inability to comply with regulatory requirements and a potential for similar behavior in the futures industry. The Subcommittee also found that Scott has not presented evidence that his continued registration would not pose a substantial risk to the public.
CFTC Obtains Default Judgment against North Carolina Foreign Currency Firm Barki LLC in a $38 Million Ponzi Scheme
October 11, 2011 Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that the U.S. District Court for the Western District of North Carolina entered an order of default judgment and permanent injunction against Barki, LLC of Mint Hill, N.C.
Federal Court Orders Texas Resident Ray M. White and CRW Management LP to Pay More than $19 Million for Defrauding Customers and Misappropriating Millions of Dollars in Forex Fraud
Ray White pleaded guilty to related federal charges and was sentenced to 10 years in federal prison.
October 11, 2011 Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) obtained federal court consent orders resolving its remaining claims against defendants Ray M. White and CRW Management LP (CRW) and relief defendants Christopher R. White and Hurricane Motorsports, LLC, all of Mansfield, Texas.