Substantial risk of loss is associated with trading commodity futures and options. You should carefully consider whether commodity futures and options are suitable for you in light of your financial condition.
The investing landscape changed materially during 2008. Equity markets sustained historic losses, commodities prices whip-sawed, and the global financial crisis left investors reeling.
The economic outlook makes equity investing less attractive. Most people aren’t knowledgeable in options or short trading. Recent news in the hedge fund world gives reason for caution. All this leaves investors wondering: “Now what?”
Take a look at the portfolios graphed on the left. As a category, portfolios with Managed Futures have performed better than traditional equity/bond portfolios not only through all of 2008, but also over the past decade.
Managed Futures are uncorrelated with equity investments, which means they’re an excellent way to diversify. Returns are not dependent on market direction, which, unlike equity investments, could enable profits in up and down markets. Through CFTC and NFA oversight, they are the most highly regulated and transparent category of alternative investments available. In short, you know where your money is and what it is invested in.
While this is no guarantee that your investment will generate positive returns, we believe Managed Futures are preferable Alternative Investments to those hedge funds that offer little or no insight into their investment strategy or the specific investments they make.
All this leads to the conclusion that Managed Futures are a sound investment for many, but not all, investors. Prior to making any investment decision you should understand the substantial risks associated with trading commodity futures and options and whether such an investment is right for you given your financial condition.
To help you make that decision, we invite you explore our website or contact us directly to learn more about investing in Managed Futures with PF&C.