Types of Investment Opportunities




Currently, there are three primary categories of managed futures.

Individual Accounts

Individual Accounts are usually opened by institutional investors or high-net-worth individuals. These funds usually require a substantial capital investment so that the advisor can diversify trading among a variety of market positions. An individual account enables institutional investors to customize accounts to their specifications. For example, certain markets may be emphasized or excluded. Contract terms may include specific termination language and financial management requirements.

Private Pools

Private Pools commingle money from several investors, usually into a limited partnership. Most of these pools have minimum investments ranging from approximately $25,000 to $250,000. These futures partnerships usually allow for admission/redemption on a monthly or quarterly basis. The main advantage of private pools is the economy of scale that can be achieved for middle-sized investors. A pool also may be structured with multiple trading advisors with different trading approaches, providing the investor with maximum diversification. Because of lower administrative and marketing costs, private pools have historically performed better than public funds.

Public Funds or Pools

Public Funds or Pools provide a way for small investors to participate in an investment vehicle usually reserved for large investors.

Participants in the Managed Futures Industry

There are several types of industry participants qualified to assist interested investors. Keep in mind that any of these participants may, and often do, act in more than one capacity.


Commodity Trading Advisors (CTAs) are responsible for the actual trading of managed accounts. There are approximately 800 CTAs registered with the National Futures Association (NFA), which is the self-regulatory organization for futures and options markets.

The two major types of advisors are technical traders and fundamental traders. Technical traders may use computer software programs to follow pricing trends and perform quantitative analysis. Fundamental traders forecast prices by analysis of supply and demand factors and other market information.

Either trading style can be successful, and many advisors incorporate elements of both approaches.


Trading Managers are available to assist institutional investors in selecting CTAs. These managers have developed sophisticated methods of analyzing CTA performance records so that they can recommend and structure a portfolio of trading advisors whose historic performance records have a low correlation with each other. These trading managers may develop and market their own proprietary products or they may administer funds raised by other entities, such as brokerage firms.


Futures Commission Merchants (FCMs) are the brokerage firms that execute, clear, and carry CTA-directed trades on the various exchanges. Many of these firms also act as CPOs and trading managers, providing administrative reports on investment performance. Additionally, they may offer customers managed futures funds to help diversify their portfolios.


Commodity Pool Operators (CPOs) assemble public funds or private pools. In the United States, these are usually in the form of limited partnerships. There are approximately 1,500 CPOs registered with the NFA. Most commodity pool operators hire independent CTAs to make the daily trading decisions. The CPO may distribute the product directly or act as a wholesaler to the broker/dealer community.


Investment Consultants can be a valuable institutional investor resource for learning about managed futures alternatives and in helping to implement the managed fund program. They can assist in selecting the type of fund program and management team that would be best suited for the specific needs of the institution. Some consultants also monitor day-to-day trading operations (e.g., margins and daily mark-to-market positions) on behalf of their institutional clients.


Learn More About Managed Futures


Copyright © 2012 RCM Futures - All rights reserved.

RCM Futures
621 S Plymouth Ct, Fl 1
Chicago, IL 60605 


TEL 1-312-870-1500
EMAIL info@rcmassetmanagement.com


Futures trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing one's financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

RCM Futures is a DBA of Reliance Capital Markets II, LLC


More than one Google Analytics scripts are registered. Please verify your pages and templates.