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Payam Pedram Explains the Benefits of Managed Futures


Payam Pedram Explains the Benefits of Managed Futures

Payam Pedram of Ascendant Asset Advisors ( explains the benefits of Managed Futures and how you can take advantage of this strategy in your portfolio. Follow him on Twitter @pympdr.

Beverly Hills, CA (PRWEB) December 22, 2010

A Managed Futures account is an alternative investment strategy which relies on the trading of professional investment managers known as a Commodity Trading Advisor (CTA). The trader specializes in commodity futures and options trading. Managed Futures investments are also referred to as CTA programs or Managed Futures Accounts.

CTAs that offer this type of asset class are required to be registered with the National Futures Association (NFA) and the Commodity Futures Trading Commission (CFTC), which are the regulators for the industry. The NFA and CFTC keep a close eye on every registered member and require the members to file updated disclosure documents regularly.

A Managed Futures account gives the ability to go both long and short, as they are highly flexible financial instruments, which allow for the potential to profit from rising and falling markets. Moreover, managed futures funds have virtually no correlation to traditional asset classes, enabling them to enhance returns as well as lower overall volatility. “Recent growth in managed futures has been substantial. In 2002, it was estimated that more than $45 billion was under management by managed futures trading advisors. By the end of 2007, that number had grown to more than $200 billion.” CMEGROUP.COM

With more recent volatility and uncertainty in the financial markets, managed futures have gained a lot of interest. As traditional money management strategies, specifically “buy-and-hold” demonstrated their inability to ensure long term gains, a more active approach to investing has become more favorable. Unlike passive management, managed futures are an actively managed investment strategy where positions are opened and closed at a much faster rate.

The futures market is also a gateway to participate in the exciting and lucrative market of commodities. With so much interest being directed towards the metals space in the last year, investing some of one's portfolio in gold, silver, or copper allows for speculation on where the price will be in the future. Soft commodities such as wheat and cotton have hit the headlines as of late as well. With major news breaking in the last year and multiple stories of current and future shortages on the horizon, the soft commodities space can serve as an exciting place to be invested in.

The benefits of Managed Futures in a balanced portfolio are:

1.    Potential to lower overall portfolio risk

2.    The ability to enhance overall portfolio returns

3.    Diversifications among numerous asset classes

4.    Opportunity to profit in a variety of economic environments

5.    Capping losses by implementing different trading strategies and disciplines

For a detailed analysis of your portfolio and whether you can take advantage of Managed Futures please contact Payam Pedram.

About Payam Pedram

Payam Pedram is a founding member and CEO of Ascendant Asset Advisors, Inc. He was approved as a Principal of AAA on April 22, 2005. He registered with the CFTC as an Associated Person and a NFA Associate Member on June 6, 2005. Pedram is also registered with the California Department of Corporations as an Investment Advisor Representative. He is a Microsoft Certified System Engineer, and a graduate of Pepperdine University with a degree in Management. He also has an MBA from Pepperdine University with a dual emphasis in Finance and Dispute Resolution.

Past performance is not indicative of future results. Trading in futures and options is speculative and not suitable for all investors. An investor can potentially lose more than the initial investment. Before investing, one must review the most recent disclosure document of ascendant asset advisors, inc.

The risk of loss in trading commodities can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition.

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