Make It Eight Years In A Row For Managed Futures

Managed futures gained 7.54% in 2007, making it eight straight years of positive performance for the strategy, according to year-end data compiled by BarclayHedge. In fact, over the past 28 years, the Barclay CTA Index has had only three losing years–in 1992, 1999 and 1999, with minor losses of 0.91%, 0.65%, and 1.19%, respectively.

“The managed-futures industry has provided comfortable, stable growth for investors for many years,” said Sol Waksman, founder and president of BarclayHedge. “Since the year 2000, managed futures have provided an compound annual return of 5.67%.”

All eight of Barclay’s CTA indices were profitable in 2007. The Barclay Diversified Traders Index was up 11.5%, systematic traders returned 8.68%, financial and metals traders gained 7.33%, and discretionary traders rose 6.43%. The Barclay BTOP50 Index, which monitors performance of the largest traders, rose 7.68% in 2007.

“The chaos in the sub-prime mortgage market has created significant challenges for equity and fixed income markets, as well as for hedge funds,” said Waksman.
“Fortunately, most managed futures investors were able to dodge the negative fallout from the sub-prime mortgage market.”

Since 2003, assets under management in the managed futures space have grown rapidly from $51 billion to approximately $190 billion today, according to Waksman.