Our weekly newsletter is out, and this time we’re tackling the question of size. After all, we live in a world where bigger is always better. Our Hummers may not be fuel efficient, but they sure look sharp. McMansions are the only way to keep up with the Joneses, off-brand is off-color, and you best not mess with Texas. But to what end is this obsession with “more” a function of base psychology, and to what extent does it push us to act against our best interests?
Don’t worry- we’re not about to bombard you with a Zizek-esque critique of consumerism, but we have found ourselves asking this question around the office a lot more these days. The past couple of years have been rough for managed futures- there’s no way around it- but many of the smaller managers we work with have done well during this time period, and far better than their titanic counterparts. Of course past performance is not necessarily indicative of future results, but why do the very large programs tend to see performance flatten out over time?
This is not to say that some of the largest CTAs aren’t quality programs. They are the best of the best across almost every quantitative and qualitative measure. But, their past performance really hasn’t been indicative of future results. After all, the giants of the managed futures space were once well known for double and triple digit returns. Today? Not so much.
Some of them will rebound from the current slump. Others may not. But why are they in a slump in the first place? Why aren’t they 100 times better than a smaller manager when they are 100 times their size? Are they delivering smaller results on purpose? Are they getting too big to access the necessary markets and trades? What we found may surprise you.
The performance data displayed herein is compiled from various sources, including BarclayHedge, RCM's own estimates of performance based on account managed by advisors on its books, and reports directly from the advisors. These performance figures should not be relied on independent of the individual advisor's disclosure document, which has important information regarding the method of calculation used, whether or not the performance includes proprietary results, and other important footnotes on the advisor's track record.
Benchmark index performance is for the constituents of that index only, and does not represent the entire universe of possible investments within that asset class. And further, that there can be limitations and biases to indices such as survivorship, self reporting, and instant history.
Managed futures accounts can subject to substantial charges for management and advisory fees. The numbers within this website include all such fees, but it may be necessary for those accounts that are subject to these charges to make substantial trading profits in the future to avoid depletion or exhaustion of their assets.
Investors interested in investing with a managed futures program (excepting those programs which are offered exclusively to qualified eligible persons as that term is defined by CFTC regulation 4.7) will be required to receive and sign off on a disclosure document in compliance with certain CFT rules The disclosure documents contains a complete description of the principal risk factors and each fee to be charged to your account by the CTA, as well as the composite performance of accounts under the CTA's management over at least the most recent five years. Investor interested in investing in any of the programs on this website are urged to carefully read these disclosure documents, including, but not limited to the performance information, before investing in any such programs.
Those investors who are qualified eligible persons as that term is defined by CFTC regulation 4.7 and interested in investing in a program exempt from having to provide a disclosure document and considered by the regulations to be sophisticated enough to understand the risks and be able to interpret the accuracy and completeness of any performance information on their own.
RCM receives a portion of the commodity brokerage commissions you pay in connection with your futures trading and/or a portion of the interest income (if any) earned on an account's assets. The listed manager may also pay RCM a portion of the fees they receive from accounts introduced to them by RCM.