An Investment Portfolio with a  Managed Futures Account: As investors we all want the same basic things. We prefer certainty to uncertainty and high returns to low returns. Our objective is to achieve a maximum rate of long term financial growth while minimizing risk. More than ever, investors are looking for alternative investment strategies that can provide capital growth in all market conditions. If the future is uncertain, then the best financial advice may be to diversify over multiple financial asset classes and prepare for markets that can move up or down.



Managed futures have been used successfully by investment management professionals for more than 30 years. Institutional investors looking to maximize portfolio exposure continue to increase their use of managed futures as an integral component of a well diversified portfolio. With the ability to go both long and short, managed futures are highly flexible financial instruments with the potential to profit from rising and falling markets. Moreover, managed future funds have virtually no correlation to traditional asset classes, enabling them to enhance returns as well as lower overall volatility.

Source of chart shown above: http://www.cmegroup.com/education/managed-futures-resource-center.html

For the years 1980 to 2010, managed futures, as measured by the CASAM CISDM CTA Equal Weighted Index, had a compound average annual return of 14.52%, while for U.S. stocks (based on the S&P 500 total return index) the return was 7.04%.[1]

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.



Managed futures have historically displayed very low correlations to traditional investments, such as stocks and bonds. Following modern portfolio theory, this lack of correlation builds the robustness of the portfolio, reducing portfolio volatility and risk, without significant negative impacts on return.

This lack of correlation stems from the fact that markets tend to "trend" the best during more volatile periods, and periods in which markets decline tend to be the most volatile. In fact the CISDM CTA Equal Weighted Index has been up 26 out of the 32 times the S&P 500 has been down 5% or greater since 1980.[1]



Managed Futures Portfolio Diversification - One of the key tenets of Modern Portfolio Theory, as developed by Nobel Prize Winning Economist, Dr. Harry M. Markowitz, is that more efficient portfolios can be created by diversifying among asset categories with low to negative correlations.



Dr. John Lintner of Harvard University states, "...judicious investments...in leveraged managed futures accounts show substantially less risk at every possible level of expected return than portfolios of stocks (or stocks and bonds) alone."  http://www.cmegroup.com/education/managed-futures-resource-center.html



PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
 _________________________________________________________________________________________

The CME Group publication, "Managed Futures, Portfolio Diversification Opportunities",  shows a portfolio with the greatest risk and least returns comprised of 55% stocks, 45% bonds, and 0% managed futures. In contrast, a portfolio exhibiting the greatest returns and least risk, comprised 45% stocks, 35% bonds and 20% managed futures.  http://www.cmegroup.com/education/files/ManagedFutures.pdf

To achieve this suggested portfolio mix, you may consider allocating  20% of your financial portfolio assets to a managed futures account trading a Trendchannel Capitalflow Portfolio.
_________________________________________________________________________________________

The Trendchannel Capitalflow Portfolio Managed Futures Account is a managed futures program that applies multiple trading systems and money management strategies to a diversified group of markets, seeking to produce consistent performance with an efficient reward/risk portfolio.

You can achieve broad diversification and profit potential by systematically trading the up and down trends in the most actively traded futures markets that represent the 4 major investment asset classes.

Trendchannel Capitalflow Portfolio - Trading 4 Asset Classes with 18 Futures Markets

Evaluate your current portfolio. Do you have any investments that will generate positive returns if:

the stock market goes down,
bonds go down (interest rates go higher),
the dollar loses value, or
commodity prices (inflation) go up?

If the answer is no, then you may want to consider adding a Trendchannel Capitalflow Portfolio
Managed Futures Account to your investments to diversify and hedge to help reduce your exposure to these market risks.

Profit and Protection - A Trendchannel Capitalflow Portfolio is an investment strategy with the goal to enhance returns, and it is an Investment Hedge that seeks to reduce risks. By taking advantage of both the up and down trends caused by major capital flows in and out of each market sector, the program attempts to profit from market trends, and at the same time, protect you from the negative effects of:

Inflation - the erosion of money buying power over time.
Declines in the Dollar - the loss of Dollar buying power versus our major trading partners' currency.
Interest rate changes - the rising costs of borrowing money or lower returns from interest income.
Stock market declines - economic down cycles or geopolitical uncertainties.
_________________________________________________________________________________________

Trendchannel Capitalflow Market Theory: 

Supply and demand determine prices.
Price changes create trends.
Trends are made up of waves that create a trend channel.

Waves and trends are continuous, recurring patterns -caused by sudden or gradual changes in trader and investor sentiment or psychology - a continual ebb and flow, from optimism to pessimism, from hope to fear, creating waves of buying (demand) and selling (supply) - capital flow.

When supply and demand are in balance, prices move sideways.
When an imbalance occurs, prices move in trends.
When demand > supply, prices move in an up trend.
When supply > demand, prices move in a down trend.

Markets are inter-connected and inter-dependent. Price changes in one market can cause an effect on the other markets in the Trendchannel Capitalflow Portfolio. Capital continually flows in and out of these assets, creating opportunities to profit from the resulting trends.

For example, the cost of money (10 Year Treasury Note), the cost of energy (Crude Oil), and the value of the dollar vs. our trading partners' currency (Euro, Yen) - each of these can cause an effect on the profitability of companies and consumer spending - which in turn effects stock index prices (Nasdaq 100).

When investors are optimistic they buy stocks and sell bonds. When they are pessimistic or seek safety,
they sell stocks and buy bonds. We are seeking profit and protection by trading these Capital Flow trends
_________________________________________________________________________________________

Summary of Managed Futures Account Potential Benefits: Diversifier, Return Enhancer, Risk Reducer.

• Profit and Protection from Macro Economic Developments
• Earn Above Average Returns
• Capitalize on U.S. and Global Market Trends
• Increase Your Portfolio Diversification
• Maintain Liquidity of Your Investment Capital
• Invest with a Time-Tested and 100% Automated System Strategy

_________________________________________________________________________________________

To receive the Commodity Trading Advisor Disclosure Document and Performance Record of Scientific Trading Solutions, Inc. Trendchannel Capitalflow Portfolio Managed Futures Accounts, click tolan@trendchannel.com , enter "CTA" in Subject, then Send.

If you have any questions, or if you want additional information, please don't hesitate to e-mail or call me.
Thank you for your interest. I look forward to hearing from you soon.    

John Tolan   tolan@trendchannel.com   970-948-6211 
Scientific Trading Solutions, Inc. 1501 Walz Avenue, Glenwood Springs, CO 81601
_________________________________________________________________________________________

Links to Managed Futures Educational Resources:
 

Managed Futures Video: Special Report - Managed Futures Funds - Bloomberg
3 min - Aug 31, 2009   Uploaded by Bloomberg   www.youtube.com
 

CME Group publication, "Managed Futures, Portfolio Diversification Opportunities".  http://www.cmegroup.com/education/files/ManagedFutures.pdf

http://www.cmegroup.com/education/managed-futures-resource-center.html

Managed Futures Resource Center
Learn more about the advantages of adding Managed Futures to your portfolio.
www.cmegroup.com/.../managed-futures-resource-center.html

Welcome to Managed Funds Association
Jul 9, 2010 ... Our members are professionals in hedge funds, funds of funds and managed futures funds, as well as industry service providers. ...
www.mfainfo.org/

Managed Futures & Hedge Funds by AutumnGold
Managed futures, cta and alternative investment database for investors, commodity trading advisors and traders. We offer free investment information about ...
www.autumngold.com/

Managed Futures (CTA) Database | Commodity Trading Advisor
The Barclay Managed Futures (CTA) Database has been the largest, most comprehensive, and most up-to-date source for managed futures data for over 20 years.
www.barclayhedge.com/products/cta-datafeeder.html

Managed Futures Account - Wikipedia, the free encyclopedia
A Managed Futures Account (MFA) is a type of alternative investment. Unlike a mutual fund, managed futures strategies can take both long and short positions

Managed Futures Account
Managed Futures Account - Definition of Managed Futures Account on Investopedia - An account that is like a mutual fund, except that positions in government ...

A Primer On Managed Futures
Defining Managed Futures The term "managed futures" refers to a ... the money manager's largest cumulative decline in equity or of a trading account. ...

managed futures account Definition
managed futures account - definition of managed futures account - An account that seeks to reduce overall portfolio volatility by investing in government ...

Are Managed Futures In the Cards for You? - WSJ.com
May 16, 2009 ... The returns on managed futures don't look good -- they look spectacular. ... An account already exists for the email address entered. ...

Google Search:
Managed Futures Account 
Managed Futures
_________________________________________________________________________________________

References:
1. Davies, Ryan, Managed Futures Consultancy, www.alternative-investment.com, March 30, 2010
_________________________________________________________________________________________

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. Futures trading involves substantial risk of loss and may not be suitable for all investors: Please see: Risk Disclosure

Scientific Trading Solutions, Inc. (DBA Trendchannel) is registered as a CTA (Commodity Trading Advisor) with the CFTC (Commodity Futures Trading Commission) and the NFA (National Futures Association).
The NFA can be contacted for verification of CTA status. 

Managed Futures Account Links: http://www.trendchannel.com/managedfuturesaccount.htm

Copyright © 1999-2010 Scientific Trading Solutions, Inc. CTA Managed Futures Account