OurÂ newsletter is up for the week, and while we usually wait for Tuesday morning to post it to our blog, the subject matter this time around warranted the evening post.
Itâ€™s Halloween, and true to its nature, weâ€™ve seen our own scary story unfolding in the futures industry with MF Global- one of the largest clearing houses in the world- filing for Chapter 11 bankruptcy today. While this event, in and of itself, would have been enough to shake the markets, the way the drama has unfolded has created a sense of total chaos for those who were unprepared for the storm.
We have been bombarded with calls and emails from concerned clients and industry participants. Everyone wants to know who is getting hit and what comes next. We canâ€™t see into the future, but this situation has some distinct parallels with the Refco blow-up in 2005, and by looking back, we may be able to gleam an understanding of what market participants can expect as the saga continues.
So here it goes- how we got here, what it means for managed futures clients, and even more questions to pile on the heap.
Forex trading, commodity trading, managed futures, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors.
The entries on this blog are intended to further subscribers understanding, education, and â€“ at times- enjoyment of the world of alternative investments through managed futures, trading systems, and managed forex.Â Unless distinctly noted otherwise, the data and graphs included herein are intended to be mere examples and exhibits of the topic discussed, are for educational and illustrative purposes only, and do not represent trading in actual accounts.
The mention of asset class performance is based on the noted source index (i.e. Newedge CTA Index, S&P 500 Index, etc.) , and investors should take care to understand that any index performance is for the constituents of that index only, and does not represent the entire universe of possible investments within that asset class. And further, that there can be limitations and biases to indices:Â such as survivorship and self reporting biases, and instant history.