Category: Alternative Investment Strategy

Is AI the next step in the evolution of trading? History proves new tools storm the markets, then high adoption erases their edge. What can futures trading history teach us about AI’s trajectory? The 1980s: Rise of Rules-Based Trading Building on simple regression models that aimed to identify patterns across sectors, the 1980s showed that […]

What makes a futures program great? Obvious answers include excellent performance, low drawdowns, a high Sharpe ratio, or consistent returns. While everyone searches for those qualities, large money managers know that the secret to producing all of those is to build portfolios that target those goals using multiple strategies. After all, high returns and low […]

My great-grandfather built a cottage on the shores of Lake Michigan almost 100 years ago. Five generations later, we still spend our summers relaxing on the beach. Some of the best days, however, can take a sharp turn. Despite perfect weather on shore, we sometimes see dark clouds gather and lightning bolts light up the […]

Success in business and elsewhere is often gained with years of experience through trial and error. Battlefield conditions necessitate a different approach that prioritizes good decision-making under the most stressful and high-stakes situations imaginable. In a different way, trading is similar. Moving millions of dollars in and out of positions while competing against the best […]

Investor psychology is an important aspect of trading. Understanding human emotions and their corresponding actions can give us a leg up in improving our trading and capitalizing on the mistakes and foibles of others. Volatile markets show this play out in real-time as panic ensues and massive moves are forgotten weeks later. The beginning of […]

I often tell aspiring traders looking to launch their programs that trading is hard, but it is only half the battle. Running a business that manages customer accounts and expectations, complies with regulations, and grows assets is just as vital. The CFTC is set to make that job a bit more difficult starting on March […]

In World War II, Germany pioneered a revolutionary tactic to spearhead an attack at a specific point in the enemy lines to overwhelm their defenses and create chaos. Donald Trump is taking the lessons of those battles and performing his own blitzkrieg as he re-enters office for a second term. Unlike his first term, in […]

When Stanley Angrist wrote an article for the Wall Street Journal on September 5, 1989, he did not anticipate anywhere close to the response that he received. He relates, “Of the 350 or so articles I published in the Journal, none produced more mail or phone calls than the one on Rich Dennis. [There was no email.] […]

Innovation is a key differentiator between traditional markets and futures markets. Exchanges, FCM, and industry personnel try to predict not only prices going forward but how people will trade in the decades to come. The CME, CBOE, and others demonstrate their desire to develop new ideas every year. Adding new contracts to include developing commodities, […]

As one of the world’s largest databases of futures traders, we see more strategies and talk to more managers in the asset class than almost anyone. We also speak with thousands of investors each year looking to improve their portfolios. These conversations over the past two decades give us great insight into what investors say […]

Two components often drive the evaluation of an investment decision in the futures world—the viability and strength of a program and the capability of a trader to execute that strategy. Recently, a marketing email from a new manager showed incredible returns, an interesting commodity, and over a year of track record. In short, the type […]

In the 1996 book “The Millionaire Next Door,” authors Thomas Stanley and William Danko set out to find wealthy individuals and learn what a typical one looks like. They began by searching ZIP codes of the most prosperous areas only to be shocked to find that while many of these individuals displayed the trappings of […]

In a comeback for the ages, the United States elected Donald Trump as its 47th President. His path to redemption seemed unlikely when he left office just four years ago, having faced two impeachments and multiple criminal indictments for issues related to handling classified information, falsifying business records, obstructing an official proceeding, and racketeering, to […]