We are a little over half way through May and have approximately two-thirds of our CTAs updated through the month of April. Overall the index is flat and carried by agriculture and equity index manager trading for the month. Trend Following is so far posting a negative month with 73% of managers reporting. So overall on the year we are off to a moderate start as we get deeper into the second quarter. Without any significant trends we expect to see much of the same as the equity markets continue on the bull run. Agriculture should be particularly interesting as we head into planting season and this pig virus continues to play itself out.
“Flyberry Capital was founded in 2011 to deliver attractive risk-adjust returns, uncorrelated to most traditional and alternative investments, and unconditional to any single market or economic environment. The company relies heavily on research, using mathematics, “big data” and sentiment analysis techniques to develop proprietary trading models and strategies. Flyberry employs a quantitative trading program that opportunistically […]
The NFA has received more than 100 comment letters over a request for comment on contentious capital adequacy rules for CPOs and CTAs. NFA members and the wider public were invited in January to comment on the concepts of imposing a capital requirement on CPOs and CTAs as well as other customer protection measures. NFA spokesman confirmed it received 115 comment letters, with the “overwhelming majority” coming from the CPO/CTA community. The measures have provoked strong reaction from the industry and representatives for CTAs and CPOs to the NFA board of directors hosted a virtual town hall meeting to discuss them. Typically, opinion is collated and submitted by trade bodies, who have also made their concerns clear.
Demeter Capital Management is a registered CTA with a Livestock and Grain Trading Futures and Options Program. The Livestock and Grain Trading Program attempts to generate profits through the Advisor’s discretionary selection of futures and options trades in agricultural markets. Trades are selected on the basis of fundamental analysis, which is concerned with any factor that would affect the supply and demand, and therefore the price, of a given instrument. The Advisor’s market analysis tends to focus on seasonal trends and year-to-year comparisons. The Advisor absorbs and interprets a wide range of research on a daily basis, employing its principals’s combined 40+ years of experience in agricultural futures markets.
Quite a whippy week. Beans and wheat broke hard earlier in the week. Wheat broke on wetter forecasts and beans broke on all the distressed China cargos and import talk. Funds liquidated flat price beans and exited spreads. There was major unwinding going on. As the week wore on, there were more and more reports of wheat being ripped up (both HRW and SRW) as well as escalating tensions between Ukraine and Russia which provided support. Both US and Brazilian bean basis firmed, we continue to see positive bean and meal sales weeks, and crush margins remain strong – all providing support to old crop beans.
Martin Fund Management (“the Fund Advisor”) is a Registered Commodity Trading Advisor (CTA) with a core focus on exchange-listed derivatives of global soft commodities (i.e. futures and futures options on coffee, cocoa, sugar, and cotton), using a Separately Managed Account (SMA) structure. The Fund Advisor seeks to generate outsized annual returns of 15%-20%, in excess of the S&P Goldman Sachs Commodity Index (S&P GSCI), employing short- to medium-term trading programs with low macro correlation and disciplined risk management. The Fund Advisor was founded by David Stephen Martin, who has over 22 years of commodity derivatives investment experience.
Commodity Trading Advisors, or CTAs, as they are commonly referred to have long been pigeon holed in the Managed Futures industry as professional money managers that trade commodities. Most people liken them to what they see in the movies. The reputation is that these are free wielding traders that have unlimited risk appetite in search of making a fortune. It may be true that speculative commodity traders that are depicted in the movies seek out returns that perhaps a novice or capital preserving investor would never be able to stomach, but most professional money managers trading in Managed Futures are seeking a risk/reward profile that appeal to a broader investing community.
Everything but soyoil rallied in March with wheat the upside leader. Funds covered shorts and got long wheat on US production risks and added risk premium for Ukraine/Russia tensions. Corn was supported on strong export demand and extremely strong ethanol margins. The same themes continued to support beans and meal – we have oversold our supply and need to ration for the remainder of the crop year. Oil made new highs early in the month in sympathy with strength in beans and on dryness in Southeast Asian palm production areas but sold off as rains materialized.
Many people want to get into commodity trading but look askance at the vagaries of the markets and worry that they will lose a lot of money. Some individuals with limited trading experience can jump into the fray without losing their pocketbook; others aren’t so fortunate. Even some investors without experience investing in commodities may be shy at moving into the sector. Fortunately, there is a way for those with means to invest in the commodities market and perhaps come out better than they started most of the time. But they have to know the right tracks to follow.
Simultaneous, intense logistical snarls in both ocean-going shipments and North American rail transportation made for divergence between cash grain values and underlying futures contracts during the month. Part of what we do is forecasting how futures will act to realign regional imbalances, but this proved largely impossible as “uneconomic” dislocations abounded as never before: Cancellation […]
Overall the IASG CTA Index was down 90 BPS for March with 71% of managers posting their returns a/o this posting. This was a particularly difficult month with the Volatility VIX index reducing dramatically in early March only to recover and spike quickly which presented an opportunity for the stock index and options CTAs. Agriculture was also an area of focus with grains primarily staying flat and end of month spiking after USDA reports indicated larger supply than was predicted along with unstable conditions in Ukraine causing corn prices to rally end of month. Finally Livestock prices achieved all time high prices as a virus continues to take its toll in decimating hogs. There were some managers that were able to exploit these markets and others who struggled. Trend Following continues to struggle in these market conditions with the first quarter showing a -1.25% loss.
Manning & Napier, Inc. (NYSE:MN), (“Manning & Napier” or “the Company”) today announced that it will acquire the business and operations of 2100 Xenon Group, LLC, an alternative investment manager specializing in managed futures and global macro strategies for institutional and individual clients. The acquisition will enhance Manning & Napier’s alternative capabilities and provide increased product diversification to clients. The transaction is subject to certain regulatory approvals and is expected to close within the second quarter. Financial terms of the transaction were not disclosed.
Market Overview: Gasoline Current demand has climbed to a robust 9 million bpd which is 3.2% higher than the three year average At 9.84 million barrels per day, soaring U.S. gasoline production is a whopping 10.6% higher than the three year average As of this report, the NYMEX spot gasoline price is at $2.99/gal which is 7.6% below […]