Managed Futures
Managed Futures industry is stable and transparent
Managed Futures industry is stable and transparent
Managed futures accounts, like all other accounts of customers doing business through a U.S. exchange, must be executed by and carried on the books of a "clearing member" (a brokerage firm or FCM that holds a membership in an exchange's clearing organization.) Once a trade between two clearing members is matched by the exchange, the rights and obligations under the futures or options contract do not run between the original buyer and seller; instead, they are between the seller and the clearing organization.An exchange's clearing organization guarantees performance on every contract to each of its clearing members.
Although each exchange's clearing function operates somewhat differently, at minimum they all ensure that there are sufficient resources to meet obligations by: (1) collecting performance bonds; (2) marking contracts to the market at least once daily; and (3) establishing capital requirements and maintaining minimum financial standards for clearing members.
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Key Benefits of
Managed Futures
- 1. Non-correlation to traditional assets
- 2. Potential for enhanced portfolio returns
- 3. Opportunity for reduced portfolio volatility risk
- 4. Opportunities in both bull and bear markets
- 5. Ability to profit independent of the economic environment
- 6. Can be employed as an inflation or deflation hedge
- 7. Provides global diversification into array of liquid markets
- 8. Managed Futures industry is stable and transparent
- 9. Potential tax benefits managed futures versus stocks