Top 3 Managed Futures Funds
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The Application of Commodity Pool Rules to Insurance Linked Securities
The Application of Commodity Pool Rules to Insurance Linked Securities October 15, 2012 The Dodd-Frank Act’s expansion of the definition of “commodity pool” to include any form of enterprise operated for the purpose of trading in “swaps,” coupled with the Commodity Futures Trading Commission (“CFTC”) and the Securities and Exchange Commission (“SEC”) recently adopting an expansive definition of the term “swap” for purposes of the Dodd-Frank Act and the Commodity Exchange Act, creates uncertainty regarding whether issuers of insurance linked securities (“ILS”) are commodity pools that would require the registration of commodity pool operators (“CPO”) and commodity trading advisors (“CTA”) with the CFTC. Expansive Definition of Swap On July 10, 2012, pursuant to a joint release (“Joint Release”) the CFTC and the SEC adopted final rules, which became effective on October 12, 2012, broadly defining the term “swap” to include, in addition to those contracts commonly known as swaps (including interest rate swaps, floors and caps, currency swaps and credit default swaps), “any agreement, contract or transaction that provides for any purchase, sale, payment or delivery..... that is dependent on the occurrence of an event or contingency associated with a potential financial, economic, or commercial consequence.” This expansive definition will encompass a broad array of contracts including those customarily underlying cat bond and other ILS transactions, unless such contracts are specifically not considered swaps under the rules or are otherwise -
By John W. Labuszewski, Managing Director Research and Product Development
RESEARCH AND PRODUCT DEVELOPMENT By John W. Labuszewski, Managing Director Research and Product Development To contact CME Group with questions or comments about Managed Futures CLICK HERE cmegroup.com How Clearing Models Manage Risk THE BEST RISK MANAGEMENT StArtS With a central counterparty model, the clearing house is the buyer to every seller and the seller to every buyer. So, if Trader A defaults, the WITH SECURITY default is contained between Trader A and the clearing house, protecting everyone in the green circles below. In today’s market environment, effective risk management requires an KiX[\i8KiX[\i8 KiX[\i9KiX[\i9 ;\]Xlckj;\]Xlckj 9lp`e^]ifd9lp`e^]ifd ever-greater emphasis on limiting counterparty credit risk. At CME Group, feKiX[\feKiX[\ KiX[\i8KiX[\i8 we believe our financial safeguards system, designed for the benefit and protection of all participants in our markets, is second to none. CME Group’s benchmark futures and options contracts, backed by our centralized counterparty clearing model and comprehensive set of risk KiX[\i8:ljkfd\ijKiX[\i8:ljkfd\ij KiX[\i9:ljkfd\ijKiX[\i9:ljkfd\ij Gifk\Zk\[Gifk\Zk\[ Gifk\Zk\[Gifk\Zk\[ management services, offer powerful solutions for navigating confidently :\ekiXc:flek\igXikp:\ekiXc:flek\igXikp through an uncertain world. :fekX`ej;\]Xlck:fekX`ej;\]Xlck • Central counterparty guarantee of CME Clearing that ensures the financial integrity of every trade The over-the-counter market’s bilateral model works differently. If Trader A defaults, neither Trader A, Trader B, nor the others they • Segregation of customer funds and a $7 billion financial safeguards transact business with are protected from the default, leaving everyone in the orange circles at risk. -
Vision Financial Markets LLC: Understanding Professionally
RISK DISCLOSURE STATEMENT TRADING FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS AND IS NOT SUITABLE FOR ALL INVESTORS. THERE ARE NO GUARANTEES OF PROFIT NO MATTER WHO IS MANAGING YOUR MONEY. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. IN CONSIDERING WHETHER TO TRADE OR TO AUTHORIZE SOMEONE ELSE TO TRADE FOR YOU, YOU SHOULD BE AWARE OF THE FOLLOWING: IF YOU PURCHASE A COMMODITY OPTION YOU MAY SUSTAIN A TOTAL LOSS OF THE PREMIUM AND OF ALL TRANSACTION COSTS. IF YOU PURCHASE OR SELL A COMMODITY FUTURES CONTRACT OR SELL A COMMODITY OPTION YOU MAY SUSTAIN A TOTAL LOSS OF THE INITIAL MARGIN FUNDS OR SECURITY DEPOSIT AND ANY ADDITIONAL FUNDS THAT YOU DEPOSIT WITH YOUR BROKER TO ESTABLISH OR MAINTAIN YOUR POSITION. IF THE MARKET MOVES AGAINST YOUR POSITION, YOU MAY BE CALLED UPON BY YOUR BROKER TO DEPOSIT A SUBSTANTIAL AMOUNT OF ADDITIONAL MARGIN FUNDS, ON SHORT NOTICE, IN ORDER TO MAINTAIN YOUR POSITION. IF YOU DO NOT PROVIDE THE REQUESTED FUNDS WITHIN THE PRESCRIBED TIME, YOUR POSITION MAY BE LIQUIDATED AT A LOSS, AND YOU WILL BE LIABLE FOR ANY RESULTING DEFICIT IN YOUR ACCOUNT. UNDER CERTAIN MARKET CONDITIONS, YOU MAY FIND IT DIFFICULT OR IMPOSSIBLE TO LIQUIDATE A POSITION. THIS CAN OCCUR, FOR EXAMPLE, WHEN THE MARKET MAKES A ‘‘LIMIT MOVE.’’ THE PLACEMENT OF CONTINGENT ORDERS BY YOU OR YOUR TRADING ADVISOR, SUCH AS A ‘‘STOP- LOSS’’ OR ‘‘STOP-LIMIT’’ ORDER, WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS, SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS. -
Proposed Rule
Vol. 76 Friday, No. 29 February 11, 2011 Part V Commodity Futures Trading Commission 17 CFR Part 4 Securities and Exchange Commission 17 CFR Parts 275 and 279 Reporting by Investment Advisers to Private Funds and Certain Commodity Pool Operators and Commodity Trading Advisors on Form PF; Proposed Rule VerDate Mar<15>2010 21:44 Feb 10, 2011 Jkt 223001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\11FEP3.SGM 11FEP3 srobinson on DSKHWCL6B1PROD with PROPOSALS3 8068 Federal Register / Vol. 76, No. 29 / Friday, February 11, 2011 / Proposed Rules COMMODITY FUTURES TRADING Commission, Three Lafayette Centre, Web site (http://www.sec.gov/rules/ COMMISSION 1155 21st Street, NW., Washington, DC proposed.shtml). Comments are also 20581. available for Web site viewing and 17 CFR Part 4 • Hand Delivery/Courier: Same as printing in the SEC’s Public Reference RIN 3038–AD03 mail above. Room, 100 F Street, NE., Washington, • Federal eRulemaking Portal: http:// DC 20549 on official business days SECURITIES AND EXCHANGE www.regulations.gov. Follow the between the hours of 10 a.m. and 3 p.m. COMMISSION instructions for submitting comments. All comments received will be posted ‘‘Form PF’’ must be in the subject field without change; we do not edit personal 17 CFR Parts 275 and 279 of comments submitted via e-mail, and identifying information from clearly indicated on written submissions. You should submit only [Release No. IA–3145; File No. S7–05–11] submissions. All comments must be information that you wish to make RIN 3235–AK92 submitted in English, or if not, available publicly. -
CFTC Proposes Rules Governing Automated Trading
CLIENT MEMORANDUM CFTC Proposes Rules Governing Automated Trading December 22, 2015 AUTHORS Rita M. Molesworth | Deborah A. Tuchman | James E. Lippert The Commodity Futures Trading Commission has proposed broad new regulations governing automated and algorithmic trading.1 The proposed regulations focus on automation of order origination, transmission and execution, and the risks that may arise from that activity. As proposed, Regulation AT would require, among other things, the implementation of pre-trade risk controls at multiple stages along the life-cycle of a trade. Regulation AT would apply to current CFTC registrants that engage in algorithmic trading and potentially also require some currently unregistered entities to register with the CFTC as floor traders if they have direct electronic access to a designated contract market (“DCM”). Regulation AT would also require the National Futures Association (“NFA”) to consider adopting additional membership rules relevant to algorithmic trading. Comments on the proposed rule are due by March 16, 2016. Key Definitions Regulation AT would add or amend certain definitions to CFTC regulations, most notably: “Algorithmic Trading” would generally be defined as trading in any commodity interest on or subject to the rules of a DCM, where (i) one or more computer algorithms or systems determine whether to initiate, modify or cancel an 1 Regulation Automated Trading, 80 Fed. Reg. 78824 (Dec. 17, 2015) (“Regulation AT”). 1 CFTC Proposes Rules Governing Automated Trading Continued order, or make certain other determinations with respect to an order, and (ii) such order, modification or order cancellation is electronically submitted for processing on or subject to the rules of a DCM. -
Managed Futures Division Consider the State of the Stock Market Over the Past 25-35 Years…
Managed Futures Division Consider the state of the stock market over the past 25-35 years… …Now imagine if over the past 5 worst period declines for stocks since 1987, you could Introduction make positive returns in your investment portfolio… …Or imagine if your investments could outperform stocks during the most critical events of the last 4 decades… As we continue, I will validate these findings and hopefully pique your interest regarding the use of Managed Futures in your portfolio. STRAITS FINANCIAL MANAGED FUTURES DIVISION | 1 Managed Futures is an investment class that may provide the opportunity for diversification not typically available in traditional stock and bond portfolios and used by investors seeking to diversify their portfolios for more than thirty years. The Managed Futures industry is comprised of professional money managers known as What are Commodity Trading Advisors (“CTAs”) who trade on behalf of investors using their own Managed Futures? unique trading system usually through analysis of fundamental or technical factors. Generally, a CTA takes a market position when, in their opinion, the potential for profit outweighs the risk of the trade. Each CTA must be registered as a Commodity Trading Advisor with the National Futures Association (“NFA”), the industry’s self-regulatory organization authorized by Congress in 1982, or the CTA must have filed an exemption with the NFA. STRAITS FINANCIAL MANAGED FUTURES DIVISION | 2 Commodity Trading Advisors may potentially offer investors benefits similar to those experienced with mutual funds and other investment advisors. These include: Professional 1. Full-time commitment to the markets and their trading programs Money Management 2. -
34-55547; File No
SECURITIES AND EXCHANGE COMMISSION (Release No. 34-55547; File No. SR-Amex-2006-110) March 28, 2007 Self-Regulatory Organizations; American Stock Exchange LLC; Order Granting Approval of Proposed Rule Change Relating to Options Based on Commodity Pool ETFs I. Introduction On November 24, 2006, the American Stock Exchange LLC (“Amex” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)1 and Rule 19b-4 thereunder,2 a proposal to amend certain rules to permit the listing and trading of options on securities issued by trust issued receipts (“Commodity TIRs”), partnership units, and other entities (referred herein to as “Commodity Pool ETFs”) that hold or invest in commodity futures products. The proposed rule change was published for comment in the Federal Register on February 6, 2007.3 The Commission received no comments regarding the proposal. This order approves the proposed rule change. II. Description of the Proposal The purpose of the proposed rule change is to enable the listing and trading on the Exchange of options on interests in Commodity Pool ETFs that trade directly or indirectly commodity futures products. As a result, Commodity Pool ETFs are subject to the Commodity Exchange Act (“CEA”) due to their status as a commodity pool,4 and therefore, regulated by the 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 See Securities Exchange Act Release No. 55187 (January 29, 2007), 72 FR 5467. 4 A “commodity pool” is defined in CFTC Regulation 4.10(d)(1) as any investment trust, syndicate, or similar form of enterprise operated for the purpose of trading commodity interests. -
Price Asset Management Brochure Rev-1-09.Indd
PRICE Asset Management Alternative Investments Group MANAGED FUTURES Portfolio Diversifi cation Opportunities Table of Contents Benefi ts of Managed Futures Page 1 Introduction to the Firm Page 6 Managed Futures Specialists Page 7 Portfolio Construction Process Page 8 This brochure is neither an offering document nor a solicitation. Investing in managed futures is speculative, involves a high degree of risk, and is not suitable for all investors. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. PRICE Asset Management Alternative Investments Group Introduction The Value of Diversifi cation The term managed futures describes an industry Today, a variety of academic research and evidence made up of professional money managers that demonstrates the potential benefi t of incorporating manage assets on behalf of their clients. Using managed futures to create better balance to a stock the global futures markets, they implement their and bond portfolio. systems to take positions based on expected profi t potential. Although futures investments involve substantial risk and are not suitable for everyone, the general conclusion Managed futures investments have been used by is that diversifi cation of non-correlated asset classes, individual investors for more than 25 years. More such as the introduction of managed futures to an recently, institutional investors such as pension investment portfolio, can both reduce portfolio risk funds, banks, endowments, trusts and family and enhance overall portfolio performance. offi ces have incorporated -
Regulation Automated Trading: Cftc Source Code Turnover Provision Is Unnecessary and Dangerous to U.S
REGULATION AUTOMATED TRADING: CFTC SOURCE CODE TURNOVER PROVISION IS UNNECESSARY AND DANGEROUS TO U.S. MARKETS Thomas Laser* Abstract Over the past several decades, the financial markets have experienced a technological revolution in how securities and other financial instruments are traded. Where these contracts and assets were once traded on the floors of various registered brick and mortar exchanges across the globe, they are now primarily traded via online platforms. While allowing greater efficiency and transparency in the markets, this shift has also spawned the practice of high-frequency algorithmic trading. This process uses highly sophisticated computers and complex algorithms to trade securities and derivative products faster than the human eye can blink. Although many argue that high-frequency algorithmic trading accounts for a great deal of liquidity in our markets and creates transparency with regard to prices, many feel that the nature of the practice creates the potential for extreme instability in the markets as well. Such instability has been exhibited periodically through occurrences known as “flash crashes.” In response to these events, the Commodity Futures Trading Commission has drafted legislation, known as Regulation Automated Trading, aimed at controlling the extent to which algorithmic trading can disrupt the marketplace. However, several of the provisions have come under a great deal of scrutiny. In particular, one provision provides that those engaging in high-frequency algorithmic trading make their source code (the algorithmic code which drives their business) available to regulatory agencies at any time. This Article analyzes the costs and benefits of high-frequency algorithmic trading, and how Regulation Automated Trading oversteps its bounds in trying to regulate the industry. -
CFTC Proposes Rulemaking Regarding Automated Trading
December 2, 2015 CFTC Proposes Rulemaking Regarding Automated Trading CFTC Proposes Regulation AT to Impose Registration, Pre-Trade Risk Control and System Safeguard Requirements for Automated Trading Firms and Related Obligations for Clearing Members and Exchanges INTRODUCTION On November 24, 2015, the Commodity Futures Trading Commission (the “CFTC” or “Commission”) voted unanimously to issue proposed rules to implement a framework of registration, compliance, recordkeeping and reporting rules for market participants engaging in algorithmic (or automated) trading activity. The proposal would also impose algorithmic trading compliance and oversight obligations on clearing member futures commission merchants (“clearing member FCMs”) and designated contract markets (“DCMs” or “exchanges”) and would impose a range of new requirements on DCMs. The proposed algorithmic trading rules (collectively, proposed “Regulation AT”), which would largely codify a range of existing industry best practices, follows the CFTC’s September 2013 Concept Release on Risk Controls and System Safeguards for Automated Trading Environments, in which the Commission originally solicited public comments on how best to address the transition to an automated and interconnected trading environment. Regulation AT includes proposed definitions for several previously undefined terms, notably including algorithmic trading, an AT Person (as used herein, “AT Person”), and direct electronic access (or “DEA”). The proposal does not define high-frequency trading, and instead is designed to apply to all algorithmic or automated trading, regardless of the speed of trading. Regulation AT would also require firms that are not otherwise registered with the CFTC in some other capacity, and that trade via DEA, to register with the CFTC as floor traders. New York Washington, D.C. -
These Terms Are Synonymous with Expectations for An
These terms are synonymous with expectations A global macro strategy primarily bases its holdings for an improving market, industry, or security. on overall economic and political views of various countries (i.e., macroeconomic principles). An investor who expects a specific industry to increase in value would be “bullish” on that Holdings may include long and short positions in industry, and would likely “buy” or “go long” that various equity, fixed income, currency, and futures industry. markets. The strategy is typically based on forecasts and analyses about interest rate trends, the global flow of funds, political changes, government policies and These terms are synonymous with expectations for relations, and other global factors. a declining market, industry, or security. An investor who expects a specific industry to decrease in value would be “bearish” on that industry, and would likely “sell” or “go short” that Global macro maintains a long history of delivering industry. attractive returns and providing diversification benefits, including low correlation (but typically not negative) to traditional asset classes. The strategy also typically operates globally, which can increases geographic diversification to a client portfolio. Global macro requires either a talented manager (like long / short equity) or a very sophisticated process. Because there are so many moving parts, the “good ideas” or “winning trades” are often watered down or completely voided by the bad trades. In a managed futures account, Commodity Trading Advisors go long or short futures contracts for various assets dependent on market trends. For example, if soybeans have been trending lower for an extended period of time, a Commodity Trading Advisors will “go short” this contract. -
Managed Accounts 2018 New Ambitions, New Solutions
Managed Accounts 2018 New ambitions, new solutions INCP-020_pub-INNOCAP_v01r2_203x273mm_bleed.pdf 3 2018-05-15 10:50 AM June 2018 Sponsors SOCIETE GENERALE PRIME SERVICES PROVIDING CROSS ASSET SOLUTIONS IN EXECUTION, CLEARING AND FINANCING ACROSS EQUITIES, FIXED INCOME, FOREIGN EXCHANGE INNOCAP.COMHedgeMark AND COMMODITIES VIA PHYSICAL OR SYNTHETIC INSTRUMENTS. CIB.SOCIETEGENERALE.COM/PRIMESERVICES THIS COMMUNICATION IS FOR PROFESSIONAL CLIENTS ONLY AND IS NOT DIRECTED AT RETAIL CLIENTS. Societe Generale is a French credit institution (bank) authorised and supervised by the European Central Bank (ECB) and the Autorité de Contrôle Prudentiel et de Résolution (ACPR) (the French Prudential Control and Resolution Authority) and regulated by the Autorité des marchés financiers (the French financial markets regulator) (AMF). Societe Generale, London Branch is authorised by the ECB, the ACPR and the Prudential Regulation Authority (PRA) and subject to limited regulation by the Financial Conduct Authority (FCA) and the PRA. Details about the extent of our authorisation, supervision and regulation by the above mentioned authorities are available from us on request. © GettyImages - FRED & FARID PARIS SOGE_METI_CIB_1705_EUROHEDGE_205x272_PLANETES_GB.indd 1 14/04/2017 15:29 NEW CLIENTS. NEW OFFICES. SAME TEAM. Managed Account Platform INCP-020_pub-INNOCAP_v01r2_203x273mm_bleed.pdf 3 2018-05-15 10:50 AM INNOCAP.COM NEW CLIENTS. NEW OFFICES. SAME TEAM. Managed Account Platform SPECIAL REPORT/MANAGED ACCOUNTS New ambitions, new solutions EDITORIAL/SUBSCRIPTIONS