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Definition of 'Managed Futures'
An alternative investment strategy in which professional portfolio managers use futures contracts as part of their overall investment strategy. Managed futures provide portfolio diversification among various types of investment styles and asset classes to help mitigate portfolio risk in a way that is not possible in direct equity investments.
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Investopedia explains 'Managed Futures'
Professional money managers, known as commodity trading advisors, typically monitor managed futures accounts. These accounts can have various weights in stocks and derivative investments. A diversified managed futures account will generally have exposure to a number of markets such as commodities, energy, agriculture and currency. Introducing futures into a portfolio reduces risk because of the negative correlation between asset groups.
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Their inverse correlation with stocks and bonds make these alternative investments worth getting to know.
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Managed futures are not all they're worked up to be. Learn why they are not a good option for investors.
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Profit from up, down and sideways markets with commodity trading advisors.
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These contracts allow for easier shorting, and provide more leverage and flexibility than stocks.
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